Aggregated News From Investment Management Regulators

SEC Charges Financial Adviser With Stealing Investor Funds to Pay Off Credit Cards, Buy Gold Coins

Report/Flag

Please complete the required fields.



Washington D.C., Oct. 28, 2021 —

The Securities and Exchange Commission today charged a former New Jersey-based broker and investment adviser representative with stealing nearly $3 million from his advisory clients and brokerage customers, which he used to buy gold coins and other precious metals and funnel to family credit card accounts that he controlled.

The SEC’s complaint alleges that Kenneth A. Welsh, a former financial adviser at a large financial institution’s branch in Fairfield, New Jersey, misappropriated at least $2.86 million from the accounts of multiple clients and customers, some of whom were senior citizens.

Specifically, the complaint alleges that from January 2016 to January 2021, Welsh transferred funds from his clients’ and customers’ accounts to pay off balances in credit card accounts held in the names of his wife and parents. Welsh also allegedly caused checks to be fraudulently drawn on his clients’ and customers’ accounts. The complaint alleges that Welsh made at least 137 fraudulent transactions and used the stolen funds to purchase gold coins and other precious metals, buy luxury goods, and make electronic fund transfers to himself.

“We allege that Welsh raided the accounts of his clients and customers for his personal gain,” said Richard Best, Director of the SEC’s New York Regional Office. “We will continue to vigorously pursue investment professionals who abuse the trust placed in them by clients and customers.”

The SEC’s complaint, filed in U.S. District Court for the District of New Jersey, charges Welsh with violations of the antifraud provisions of the federal securities laws and seeks injunctive relief, disgorgement of ill-gotten gains, prejudgment interest, and civil penalties.

In a parallel action, the U.S. Attorney’s Office for the District of New Jersey today announced criminal charges against Welsh.

The SEC’s investigation, which is continuing, is being conducted by John Lehmann, Vanessa De Simone and Jordan Baker and supervised by Lara S. Mehraban of the New York Regional Office.  Mr. Lehmann and Christopher Dunnigan will lead the litigation. 

This news item was originally published by the US Securities and Exchange Commission (SEC US). For more information, see the Source Link.

Regulator Information

Abbreviation: SEC
Jurisdiction: United States

Recent Articles

ASIC calls on industry to continue to improve resilience during market outages

ASIC is calling on market operators and participants to continue to implement its expectations to improve the resilience of the Australian equity market during...

ESMA will not publish August systematic internaliser regime data for non-equity instruments other than bonds and CTP data

The European Securities and Markets Authority (ESMA) will not publish the 1 August 2022 publication of the systematic internaliser (SI) regime data for non-equity...

Macroprudential decision: Recommendation on mortgage borrowers’ maximum debt-servicing burden – credit institutions’ capital requirements also reviewed

The Board of the Financial Supervisory Authority (FIN-FSA) recommends that housing loans in future be granted, as a rule, to loan applicants whose total...

ASIC wins appeal on Cigno and BHF Solutions Federal Court decision

ASIC has succeeded in its appeal before the Full Federal Court which has found unanimously that a ‘financial supply fee’ charged by Cigno Pty...

Quarterly stakeholder bulletin

Published on: 28 June 2022 The Isle of Man Financial Services Authority has issued the latest edition of its quarterly update for stakeholders.

Get the latest from Regulatory.News in your inbox!

×