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Regulation and Compliance > Federal Regulation > SEC

SEC Charges Advisor With Stealing Over $743K From Clients, Including MLB Player

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What You Need to Know

  • An advisor made, or caused others to make, 241 unauthorized transfers totaling about $739,000 from an MLB player's account.
  • The transfers were used to pay for charges on his dead mother’s American Express card.

The Securities and Exchange Commission charged a former investment advisor representative with misappropriating over $743,000 in funds from a Major League Baseball player and another client to pay his personal expenses.

In a complaint filed Monday in U.S. District Court for the Central District of California, the SEC alleged that, between between December 2017 and June 2020, Marc J. Frankel, 61, of Tarzana, California, stole the money from two clients and used their funds to pay for personal charges on an American Express credit card in the name of his deceased mother.

Those charges allegedly included college tuition for Frankel’s kids, electronics, jewelry, sports tickets and travel, according to the complaint, which did not identify the clients by name, referring to them only as “Advisory Client #1” and “Advisory Client #2.”

“In total, Frankel made, or caused others to make, 241 unauthorized transfers totaling” about $739,052 from the account of Advisory Client #1, the MLB player, to his dead mother’s American Express card, the complaint said.

Frankel allegedly made a few small payments every month to evade detection and took additional steps to conceal his fraud, including falsely claiming the payments were for a credit card held by the baseball player’s personal assistant, according to the complaint.

The SEC’s complaint charged Frankel with violating the antifraud provisions of the Investment Advisers Act. The SEC is seeking civil penalties, disgorgement with prejudgment interest and a permanent injunction.

FINRA Suspension

Morgan Stanley was the first Financial Industry Regulatory Authority-affiliated firm Finkel  served as a broker for, from September 1997 until February 2002, according to his report at FINRA’s BrokerCheck website.

Frankel briefly served as a broker for Wells Fargo Advisors Financial Network from May 2010 to July 2010 and as a broker again for Morgan Stanley from June 2009 to June 2010. He was a broker for two other firms between his two Morgan Stanley stints.

Frankel failed to pay money owed on two promissory notes when he left Wells Fargo in 2010, the firm had alleged in an action against him. An arbitrator ruled in the company’s favor on May 26, 2011, according to an award posted on FINRA’s website.

FINRA suspended Frankel in 2013 after he “failed to comply with an arbitration award or settlement agreement or to satisfactorily respond to a FINRA request to provide information concerning the status of compliance,” according to a disclosure on his BrokerCheck report.

During the time in which Frankel was allegedly stealing funds from his two clients, he was employed as an investment advisor representative for Partnervest Advisor Services in Santa Barbara, California. Partnervest merged with Kansas RIA ChangePath in October 2020, according to the Partnervest website.

Frankel is currently the owner of MJF Advisors, which had an office in Encino, California, according to the SEC complaint. He is not currently registered with the SEC or FINRA.

Wells Fargo declined to comment about the charges against Frankel on Wednesday. ChangePath didn’t immediately respond to a request for comment.

(Photo: Diego M Radzinschi/ALM)


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