A former financial adviser at HCR Wealth Advisors has agreed to a consent judgement with the U.S. Securities and Exchange Commission (SEC) , admitting that he defrauded a professional athlete and his wife out of $1.2 million.
Broker Misled and Defrauded Client of Millions
According to the SEC, advisor Jeremy Joseph Drake of HCR Wealth Advisors managed around $35 million of his clients’ assets while he worked at the firm, all the while, misleading his clients about the fees he was charging to manage their money.
For years Drake told the couple that they were getting a low “VIP” rate of 0.15 to 0.2 percent for asset management after certain “credits” to their account instead of the typical 1 percent. Instead, he was misappropriating funds with abandon and doctoring the statements.
The SEC reports that Drake even made up a fictitious employee at Charles Schwab & Co. Inc. for support before admitting to the misconduct in 2016 and asking the athlete and his wife not to report him.
Consent Agreement Will Determine Advisor’s Judgement
The consent agreement allows a judge to determine Drake’s punishment and to decide if Drake must pay disgorgement of ill-gotten gains and, if so, in what amounts.
In March of last year, Drake pled guilty to one count of wire fraud in a parallel criminal case over the same allegations.
Drake’s experience in the securities industry dates back to 2007 with stints at UBS and Morgan Stanley in California. In 2016, he separated from HCR Wealth Advisors, which commenced an investigation after receiving notice that one of Drake’s clients inquired about a duplicate monthly account statement. The inquiry was elevated to a complaint.
Suffering as a Result of Stockbroker Misconduct?
Regulatory rules and various state laws require brokerage firms to supervise their brokers. If you or someone you know lost money as a result of stockbroker misconduct, the brokerage firm may be responsible for your losses. Contact an experienced investment fraud attorney at Dimond Kaplan & Rothstein, P.A. to discuss your rights today.
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