SEC Charges Kimberly Sredich with Misappropriation Scheme

Litigation Release No. 24456 / April 19, 2019

Securities and Exchange Commission v. Kimberly Sredich, Civil Action No. 19-cv-11140 (E.D. Michigan, filed April 18, 2019)

On April 18, 2019, the Securities and Exchange Commission charged Kimberly Sredich, a Michigan resident, with misappropriating funds from brokerage customers of a registered broker-dealer with which she was associated. The SEC's complaint alleges that between 2014 and 2018, Sredich sold securities in at least 15 customer accounts and misappropriated the proceeds of the sales. According to the complaint, many of the customers were elderly. The complaint further alleges that Sredich forged customers' signatures and used blank letters of authorization previously signed by customers to transfer funds to a company she controlled. She then allegedly transferred most of the misappropriated funds to a personal bank account.

The SEC's complaint filed in the Eastern District of Michigan alleges that Sredich violated Section 10(b) the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.

In a parallel action, the U.S. Attorney's Office for the Eastern District of Michigan filed criminal charges against Sredich, who was arrested by the Federal Bureau of Investigation. The SEC's investigation, which is continuing, is being conducted by Sarah Hancur and Jean Javorski and supervised by C.J. Kerstetter. The SEC's litigation will be led by John Birkenheier.