SEC Obtains Judgment Against Former Transamerica Broker Accused of Defrauding Investors
The U.S. District Court for the Southern District of Ohio has entered a final judgment against Scott Allen Fries
The U.S. District Court for the Southern District of Ohio has entered a final judgment against Scott Allen Fries, a former registered representative and investment adviser representative at Transamerica, for defrauding investors out of approximately $500,000.
According to the SEC’s complaint, Fries, who primarily sold life insurance and annuity products, recommended that some of his brokerage customers provide him with money for investments away from his firm.
Between March 2014 and March 2019, Fries purportedly raised $458,000 from at least 10 investors and spent that money on personal expenses – such as mortgage payments, payday loans and credit card bills. All of the checks he received from investors were deposited into his own bank accounts, the SEC said.
To hide his alleged fraudulent activities, the SEC claims that Fries lied to investors about the status of their investments, created and distributed false account statements purporting to show profitable investments, paid off an investor couple who had discovered that their account statement was fake, and subsequently lied to his employer about receiving investment funds from his brokerage customers.
Fries, who was barred by FINRA in August 2019, spent four years with Transamerica before being fired in July 2019 for “accepting funds to invest in securities products away from the firm.” Prior to Transamerica, he spent five years with NYLife Securities.
He was enjoined from violating the antifraud provisions of various federal securities laws and was ordered to pay $538,800 in disgorgement and prejudgment interest, as well as a civil penalty of $208,500.
