Important question—will the passage of the SECURE Act make stories like these more or less prevalent?
The Securities and Exchange Commission (SEC) charged Sacramento-based investment advisory firm Springer Financial Advisors (SFA) and owner Keith Springer with defrauding hundreds of retail clients, most of them in or close to retirement.
The SEC’s complaint alleges that Springer and the firm received millions of dollars in undisclosed compensation and other benefits for recommending certain investment products while claiming that they did not have any conflicts of interest.
According to the complaint, many clients learned of Springer through his radio show, “Smart Money with Keith Springer,” and Springer supposedly misled prospective clients into believing he was selected to host the show because of his industry expertise.
In reality, SFA paid to broadcast the show.
The SEC’s complaint further alleges that Springer went to great lengths to hide prior charges by the SEC and his disciplinary history with the New York Stock Exchange, hiring internet search suppression consultants and instructing employees not to provide the information to prospective clients.
“Our complaint alleges that Springer actively targeted vulnerable retirees by misleading them about his prominence in the industry and promising to act in their best interests,” Erin Schneider, Director of the SEC’s San Francisco Regional Office, said in a statement. “Investment advisers must be truthful about their background and fully disclose all conflicts of interest.”
Springer responds
In a statement to KCRA in Sacramento, Springer said the “The allegations are absolutely untrue and completely baseless.”
The SEC’s complaint, filed in federal court in Sacramento, charges Springer and SFA with violating the antifraud provisions of the federal securities laws as well as SEC rules concerning advertisements, compliance, required disclosures, SEC reporting, and recordkeeping.
The SEC is seeking injunctions, disgorgement of allegedly ill-gotten gains, and civil penalties.
The Office of Investor Education and Advocacy also issued an “Investor Alert,” warning investors about the role that radio programs can play in soliciting victims for investment schemes. The alert provides tips on how to investigate radio programs and persons associated with them.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
