SEC Charges Investment Adviser With Fraud Worth $100m

3 September 2019: The Securities and Exchange Commission (SEC) has charged an investment adviser with operating an investment advisory fraud worth over $100m.

The Pennsylvania adviser, Brenda Smith, is alleged to have raised around $105m from 40 investors after she said that she would invest their money in publicly traded securities that provided consistently high returns. In reality, Smith used the money for her own investments and to repay investors in other schemes. Further, Smith allegedly provided false statements and fabricated documents to the investors, which showed positive returns and reassured them that their capital was safe. 

The complaint was filed in federal court in Newark, New Jersey, whereby the court granted the SEC’s request for an asset freeze and a temporary restraining order.