SEC Charges Former Adviser with Stealing $1 Million from Three Elderly Clients
The Securities and Exchange Commission has charged former investment adviser Naseem Mohammed Salamah with fraud after he allegedly stole at least $968,600 from three elderly advisory clients.
The Securities and Exchange Commission has charged former investment adviser Naseem Mohammed Salamah with fraud after he allegedly stole at least $968,600 from three elderly advisory clients from August 2017 to May 2021.
According to the SEC’s complaint, Salamah chose these three clients because “he did not think they would pay close attention to their brokerage account statements.”
The SEC alleges that Salamah falsely represented to his clients that he was moving their funds to diversify their securities holdings, but instead used altered authorization forms to transfer their funds to a bank account that he controlled. He is also accused of forging the signature of his firm’s chief compliance officer in order to make it appear that the transfer was authorized.
According to the complaint, he used the money for personal expenses, including vacations, luxury cars, and private school tuition.
When one of Salamah’s clients continued to question why her account balances were much smaller than what she expected, he provided her with fraudulently altered brokerage statements that made the balances appear higher than they actually were.
He also allegedly fabricated tax forms for one of his clients when questions arose concerning withdrawals from her brokerage account and taxes owed to the IRS.
The SEC said that Salamah’s scheme started to unravel in May 2021 when a client’s daughter learned of the “significant” withdrawals from the brokerage account and began asking questions. As a result, his employment was terminated, and he was denied access to his clients’ accounts.
According to the SEC, from January 2013 to June 2021, Salamah was affiliated with a then state-registered investment adviser, which was not named in the complaint. According to his BrokerCheck profile, he was fired from NinePoint Advisors in late May for allegedly “forging paperwork to have disbursements made from client accounts without their knowledge, and have the checks made out to a separate account which he controlled.”
The SEC’s complaint charges Salamah with violating the antifraud provisions of various federal securities laws and seeks injunctive relief, disgorgement, prejudgment interest, and civil penalties.
He has consented to an injunction and to have the court consider the SEC’s claims for disgorgement, prejudgment interest, and civil penalties at a later date. The U.S. Attorney’s Office for the Northern District of Illinois filed criminal charges in a parallel action.
