UNITED STATES OF AMERICA
SECURITIES AND EXCHANGE COMMISSION
Securities Exchange Act of 1934
Release No. 51131 / February 3, 2005
Investment Advisers Act of 1940
Release No. 2346 / February 3, 2005
Admin. Proc. File No. 3-11807
IN THE MATTER OF SCOTT F. MCCREADIE
The Commission today issued an Order Instituting Administrative Proceedings and Notice of Hearing Pursuant to Section 15(b) of the Securities Exchange Act of 1934 (Exchange Act) and Section 203(f) of the Investment Advisers Act of 1940 (Advisers Act) (the Order) against Scott F. McCreadie of Wellington, Florida.
The Division of Enforcement (Division) alleges in the Order that from January 1999 until June 2002, McCreadie was employed by UBS PaineWebber (PaineWebber), a registered investment adviser and broker-dealer now known as UBS Financial Services, Inc. The Division alleges that, on November 10, 2004, the United States Attorney for the District of Massachusetts filed a criminal Information against McCreadie concerning his misappropriation of funds from PaineWebber customers. The Information charged McCreadie with one count of violating Section 10(b) of the Exchange Act and two counts of tax evasion. The case was filed in United States District Court for the District of Massachusetts and is entitled United States v. Scott F. McCreadie (Criminal No. 04-CR-10338WGY). The Information charged that, from in or about April 2000 through June 2002, McCreadie engaged in a scheme to defraud his wife's family in connection with the purchase and sale of securities. According to the Information, McCreadie diverted into his own personal brokerage and bank accounts over $700,000 from PaineWebber brokerage accounts belonging to his wife's family members. McCreadie was the designated registered representative or financial adviser for these accounts. The Information alleges, among other things, that McCreadie used forged letters of authorization and forged checks to transfer funds out of various PaineWebber accounts in the name of his wife's family into a PaineWebber brokerage account and a separate bank account, both held jointly by McCreadie and his wife. According to the Information, McCreadie then spent the funds on stock trades and personal expenses. The Division further alleges that, on January 18, 2005, McCreadie pled guilty to the three counts alleged in the Information, including the violation of Section 10(b) of the Exchange Act described above.
A hearing will be scheduled before an administrative law judge to determine whether the allegations contained in the Order are true, to provide McCreadie an opportunity to dispute the allegations, and to determine what, if any, remedial action is appropriate and in the public interest pursuant to Section 15(b) of the Exchange Act or Section 203(f) of the Advisers Act. The Order requires the Administrative Law Judge to issue an initial decision no later than 210 days from the date of service of the Order, pursuant to Rule 360(a)(2) of the Commission's Rules of Practice.
See also the Order in this matter