Stephen F. Clifford d/b/a Clifford Financial Assocs.

CORRECTED

U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 21711 / October 27, 2010

Former Investment Adviser Sentenced to Eight Years in Prison

United States v. Stephen Clifford, No. 09-CR-10387-NG (D. Mass.).

SEC v. Stephen F. Clifford d/b/a Clifford Financial Assocs., No. 08-CV-11023-RGS (D. Mass.).

The Commission announced today that, on October 26, 2010, Stephen F. Clifford, formerly an investment adviser based in Plymouth, Massachusetts, was sentenced to eight years and one month in federal prison, followed by three years of supervised release, in connection with his earlier guilty plea to criminal charges brought by the United States Attorney's Office for the District of Massachusetts. On May 4, 2010, Clifford pled guilty to one count of willfully violating Sections 206 and 217 of the Investment Advisers Act of 1940, one count of wire fraud, one count of mail fraud, and three counts of subscribing to false tax returns. Clifford's federal prison term will run consecutively to a state prison term he is currently serving for an unrelated offense. Clifford also must pay restitution in the federal criminal action of over $4.5 million.

The Commission filed a civil injunctive action against Clifford on June 17, 2008. The Commission's action, which is still pending, alleges that, between at least July 2004 and June 2008, while acting as an investment adviser, Clifford defrauded nearly a dozen investors of nearly $3 million and misappropriated investor funds for his personal use. The U.S. Attorney's Office filed its case against Clifford on December 16, 2009, making substantially similar charges.

On June 2, 2010, based on his guilty plea in the federal criminal action, the Commission instituted and simultaneously settled public administrative proceedings against Clifford and barred him from association with any broker, dealer, or investment adviser.

The Commission acknowledges the assistance of the Massachusetts Securities Division, the United States Postal Inspection Service, and the United States Attorney's Office.

For more information, see Litigation Release Nos. 20622 (June 18, 2008), 21343 (December 18, 2009), and 21518 (May 6, 2010), and Exchange Act Release No. 62208 (June 2, 2010).