(HedgeCo.Net) The Securities and Exchange Commission today charged a Tallahassee-based investment adviser firm and its two former principals with defrauding investors, most of whom were retired NFL players who had joined a class-action lawsuit against the league claiming they suffered brain injuries as a result of concussions.<\/p>\n
The SEC charged Cambridge Capital Group Advisors, LLC (f\/k\/a Cambridge Capital Advisors, LLC); Cambridge\u2019s president Phillip Timothy Howard, a Florida attorney who represented the retired players in the class action lawsuit; and Don Warner Reinhard, a former registered investment adviser previously barred by the SEC, with defrauding 20 investors in two proprietary hedge funds operating out of Howard\u2019s law offices. According to the SEC\u2019s complaint, the defendants advertised that the funds would invest in a variety of instruments, but unbeknownst to investors, in fact invested almost exclusively in settlement advance loans to more than 70 of Howard\u2019s NFL class-action clients.<\/p>\n
As alleged, the defendants represented that Reinhard was an \u201cextremely successful investment manager,\u201d but failed to mention that he had served jail time for bankruptcy and tax fraud, and had been barred by the SEC from working for any investment adviser firm. The SEC further alleges that Howard defrauded investors by borrowing $612,000 in undisclosed personal mortgage loans from the funds, which he never repaid, and that Howard and Reinhard used investor funds to pay themselves fabricated \u201cbroker fees\u201d on settlement advance loans to Howard\u2019s legal clients. Howard and Reinhard allegedly raised $4 million from the retired NFL players, about half of whom rolled over their NFL 401(k) accounts to the hedge funds.<\/p>\n
\u201cWe allege that Cambridge, Howard and Reinhard defrauded these particularly vulnerable investors, many of whom invested their retirement savings,\u201d said Eric I. Bustillo, Director of the SEC\u2019s Miami Regional Office. \u201cInstead of investing all of the funds\u2019 assets as promised, Howard and Reinhard used a significant portion of investor money to line their own pockets.\u201d<\/p>\n
The SEC\u2019s complaint filed in federal district court in the Northern District of Florida charges Howard, Reinhard, and Cambridge with violating the anti-fraud provisions of the federal securities laws, and seeks permanent injunctions, disgorgement of allegedly ill-gotten gains, prejudgment interest, and financial penalties.<\/p>\n","protected":false},"excerpt":{"rendered":"
(HedgeCo.Net) The Securities and Exchange Commission today charged a Tallahassee-based investment adviser firm and its two former principals with defrauding investors, most of whom were retired NFL players who had joined a class-action lawsuit against the league claiming they suffered […]<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16,3,16048],"tags":[],"class_list":["post-70768","post","type-post","status-publish","format-standard","hentry","category-hedgeco-networks-press-releases","category-hedgeco-news","category-hedgecovest-news"],"_links":{"self":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/70768","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/comments?post=70768"}],"version-history":[{"count":1,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/70768\/revisions"}],"predecessor-version":[{"id":70769,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/70768\/revisions\/70769"}],"wp:attachment":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/media?parent=70768"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/categories?post=70768"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/tags?post=70768"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}