The Securities and Exchange Commission today announced charges against Michigan resident Steven F. Muntin for allegedly defrauding one of his investment advisory clients out of more than $314,000.

According to the SEC's complaint, Muntin worked for an SEC-registered investment adviser and also managed certain investments for his clients outside of that adviser through his own company, Executive Asset Management, Inc. According to the complaint, Executive Asset Management was previously registered as an investment adviser with the state of Michigan. As alleged, between March 2016 and February 2020, Muntin solicited one of his elderly advisory clients to write checks totaling $305,750 to Executive Asset Management for purported investments in securities. However, according to the complaint, Muntin did not invest the client's money in securities, but spent it for his own benefit, including to pay his mortgage, real estate taxes, health insurance, boat and car loans, and credit card bills. The complaint further alleges that Muntin also overcharged the client for at least $9,000 in assets under management fees.

The SEC's complaint, filed in federal district court in the Eastern District of Michigan, charges Muntin with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940, and seeks injunctive relief, disgorgement with pre-judgment interest, and civil penalties.

The SEC's investigation was conducted by James A. Davidson and Jonathon Grobelski and supervised by Anne C. McKinley and Daniel J. Hayes of the Chicago Regional Office. The matter arose out of a referral from the Chicago Regional Office's examination program with an exam conducted by Stanton Nelson, Stacey Gohl and Susan Weis and supervised by Maureen Dempsey.