SEC Charges Former Merrill Lynch Registered Representative with Defrauding Investors
The Securities and Exchange Commission has charged Phillip Conley, a West Virginia-based former registered representative, with conducting fraudulent securities offerings in which he raised approximately $5.2 million from at least 20 investors.
The Securities and Exchange Commission has charged Phillip Conley, a West Virginia-based former registered representative, with conducting fraudulent securities offerings in which he raised approximately $5.2 million from at least 20 investors.
The SEC claims that between January 2014 and September 2018, Conley convinced some of his most trusting investors, including pastors and church congregants, to invest their money with one or more of the entities he controlled while knowing the investments were not legitimate.
Conley allegedly induced investors to purchase securities, including purported limited partnership interests, in a variety of ventures, including construction of university student housing, high-yield fixed-income securities, oil and gas technologies and infrastructure, mineral rights leasing, and timber management, among other things.
He allegedly used most of the funds for his personal benefit, including private jet rentals, luxury purchases, dining, and entertainment, while using the remainder to make Ponzi-like payments to earlier investors. The SEC also noted that Conley provided some of his investors with fictitious quarterly account statements, “knowing that the balances and gains reported on the statements were entirely false.”
Conley was affiliated with Merrill Lynch from 2012 until 2014, and with Wells Fargo for two years previously.
According to his BrokerCheck profile, he was suspended by FINRA in December 2015 for failing to comply with an arbitration award where he was liable to pay Merrill Lynch $699,800 in compensatory damages. Conley’s former employer alleged that when he began his employment, he received a loan by executing a promissory note and refused to repay it after he voluntarily resigned in May 2014.
The SEC’s complaint charges Conley with violations of the antifraud provisions of various federal securities laws, and seeks a permanent injunction, disgorgement of ill-gotten gains, prejudgment interest, and civil monetary penalties.
