A former Morgan Stanley broker and Wells Fargo advisor has been barred from the industry by the Securities and Exchange Commission for using personal email and text messages to solicit unlawful business from pro-athlete clients.
According to the SEC’s Monday order, beginning in 2009 and continuing into 2012, Aaron Parthemer of Fort Lauderdale, Florida, participated in selling more than $5 million of unregistered, illiquid securities to certain of his professional athlete brokerage customers and investment advisory clients in an internet branding company known as Global Village Concerns, Inc. (GVC), based in San Diego.
Parthemer, the order states, was issued GVC stock options and warrants provided by GVC, and his conduct with respect to the sale of GVC securities “occurred outside and independent of his employment with registered broker-dealers.”
From June 2009 to October 2011 and from October 2011 to the end of April 2015, the order states that Parthemer was a registered rep and investment advisor rep of Morgan Stanley Smith Barney and Wells Fargo Advisors, respectively.
During this time, MSSB and WFA were dually registered with the SEC as broker-dealers and investment advisors.
From 2005 until December 2012, Parthemer was a National Football League Players Association Registered Financial Advisor.
Parthemer, the order states, “misrepresented and omitted material information about the GVC investments to his investment advisory clients, some of which was based on information provided to Parthemer by GVC.”
He presented this information to his advisory clients “without conducting any due diligence to verify any of the information he provided to his advisory clients,” and he also used “his personal communication devices and emails to communicate with his brokerage customers and others about firm business without causing copies of those communications to be sent to or preserved on the broker-dealers’ respective email servers or preserved in paper form,” according to the order.
From 2009 through 2013, Parthemer had approximately 40 active or retired professional athletes as brokerage customers and/or investment advisory clients, most of whom are members of NFLPA.
During most of that time, according to the SEC, “Parthemer was a NFLPA Advisor and subject to the Regulations and Code of Conduct Governing Registered Player Financial Advisors promulgated by the NFLPA.”
Some Parthemer customers were brokerage customers, while others were fee-based investment advisory clients that paid advisory fees for which Parthemer recommended and managed their investments.