(HedgeCo.Net) The Securities and Exchange Commission has charged a former New Jersey-based broker and investment adviser representative with stealing nearly $3 million from his advisory clients and brokerage customers, which he used to buy gold coins and other precious metals and funnel to family credit card accounts that he controlled.

The SEC’s complaint alleges that Kenneth A. Welsh, a former financial adviser at a large financial institution’s branch in Fairfield, New Jersey, misappropriated at least $2.86 million from the accounts of multiple clients and customers, some of whom were senior citizens.

Specifically, the complaint alleges that from January 2016 to January 2021, Welsh transferred funds from his clients’ and customers’ accounts to pay off balances in credit card accounts held in the names of his wife and parents. Welsh also allegedly caused checks to be fraudulently drawn on his clients’ and customers’ accounts. The complaint alleges that Welsh made at least 137 fraudulent transactions and used the stolen funds to purchase gold coins and other precious metals, buy luxury goods, and make electronic fund transfers to himself.

“We allege that Welsh raided the accounts of his clients and customers for his personal gain,” said Richard Best, Director of the SEC’s New York Regional Office. “We will continue to vigorously pursue investment professionals who abuse the trust placed in them by clients and customers.”

The SEC’s complaint, filed in U.S. District Court for the District of New Jersey, charges Welsh with violations of the antifraud provisions of the federal securities laws and seeks injunctive relief, disgorgement of ill-gotten gains, prejudgment interest, and civil penalties.

In a parallel action, the U.S. Attorney’s Office for the District of New Jersey today announced criminal charges against Welsh.