SEC Charges Recidivist Investment Adviser with Defrauding Retirees
The Securities and Exchange Commission has charged Sacramento, California-based investment adviser firm Springer Investment Management Inc., doing business as Springer Financial Advisors (SFA), and owner Keith Springer with defrauding hundreds of retail clients.
The Securities and Exchange Commission has charged Sacramento, California-based investment adviser firm Springer Investment Management Inc., doing business as Springer Financial Advisors (SFA), and owner Keith Springer with defrauding hundreds of retail clients.
The SEC’s complaint alleges that Springer and Springer Financial received millions of dollars in undisclosed compensation and other benefits for recommending certain investment products while claiming that there were no conflicts of interest.
The SEC claims that Springer placed advisory clients into investments in fixed indexed annuities and recommended that his clients sell securities in existing retirement accounts to fund an annuity, or to sell an existing annuity and pay the associated surrender fee to fund a new annuity.
According to the complaint, many clients learned of Springer through his radio show, “Smart Money with Keith Springer,” and Springer allegedly misled prospective clients into believing he was selected to host the show because of his industry expertise. However, the SEC claims that Springer Financial paid to broadcast the show.
In addition, Springer paid for sponsored content on websites such as Forbes.com and Money.com, and allegedly directed his employees to create versions of the articles that said “Published” at the top with the website logo to make the content appear to have been published work rather than advertisements.
Springer had the altered versions distributed to clients and prospective clients, the SEC said, which also included false claims such as, “Keith was recently asked by Forbes to write an article on successful retirement planning” which “was just published by the magazine.”
The SEC’s complaint further alleges that Springer attempted to hide prior charges by the SEC and his disciplinary history with the New York Stock Exchange by 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,” said Erin E. Schneider, director of the SEC’s San Francisco regional office. “Investment advisers must be truthful about their background and fully disclose all conflicts of interest.”
The SEC’s complaint, filed in federal court in Sacramento, charges Springer and his firm 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.
