SEC Charges Former Investment Adviser with Stealing from Clients
Litigation Release No. 25503 / September 13, 2022
Securities and Exchange Commission v. Marc J. Frankel, No. 2:22-cv-06500 (C.D. Cal. filed September 12, 2022)
The Securities and Exchange Commission today announced fraud charges against former investment adviser representative Marc J. Frankel, who allegedly misappropriated client funds to pay his personal expenses.
According to the SEC's complaint, between December 2017 and June 2020, Frankel stole more than $743,000 from two clients, including a Major League Baseball player. Frankel allegedly used their funds to pay personal charges on a credit card in the name of his deceased mother. As alleged in the complaint, those charges included sports tickets, college tuition for Frankel's children, travel, jewelry, and electronics. Frankel allegedly made several small payments each month in order to evade detection and took other steps to conceal the fraud, such as falsely claiming that the payments were for a credit card held by the baseball player's personal assistant.
The SEC's complaint, filed in U.S. District Court for the Central District of California, charges Frankel with violating the antifraud provisions of the Investment Advisers Act. The SEC is seeking a permanent injunction, disgorgement with prejudgment interest, and civil penalties.
The SEC's investigation was conducted by Colleen Keating and supervised by Robert Conrrad of the Los Angeles Regional Office. The litigation will be led by Douglas Miller and supervised by Gary Leung.