The Securities and Exchange Commission recently charged a former Edward Jones broker with stealing investor funds to pay for a home remodel job and fined a political intelligence firm for compliance failures around nonpublic information.
SEC Charges Ex-Edward Jones Broker With Stealing Investor Funds
The SEC has charged Bernard Parker, a former Edward Jones broker, with fraud after alleging that he used investor funds not to buy the investments he promised clients, but instead to remodel his Indiana, Pennsylvania, home, make car payments and pay bills for his father-in-law.
Edward Jones fired Parker in late 2014, according to the Financial Industry Regulatory Authority’s BrokerCheck database, after he admitted to misappropriating client money and making false statements about his outside business activity.
According to the SEC, Parker raised more than $1.2 million from his longstanding brokerage customers and others who were told they were buying legitimate real estate tax lien certificates, and that the investment would bring them returns of 6% to 9% per year.
But only a little of the money Parker brought in went to buy tax liens, which Parker told his clients were placed by municipalities on properties primarily in Florida, Arizona and Colorado.
The rest of the money went for personal purchases, the SEC said. Parker pooled investors’ money into several bank accounts, and when he cashed investors’ checks he routinely deposited a portion of the money into a bank account and took the remainder in cash.
The scale of the alleged fraud, which went on from 2008 to 2014 through his company Parker Financial Services, was impressive; he withdrew more than $650,000 in investor funds in cash from teller transactions, ATM withdrawals and checks cashed at local supermarkets. He also spent approximately $197,000 of investor money in point-of-sale transactions, $150,000 through personal checks, and $169,000 for online bill payments.
He also made approximately $188,000 in phony interest payments to earlier investors to try to keep from being found out, the SEC said.