SEC v. Caz L. Craffy, No. LR-26363, District of New Jersey (July 29, 2025) — Press Release
raw: Caz L. Craffy
Caz L. Craffy, No. 3:23-cv-03639 (D.N.J. July 29, 2025)
summary
Former Army financial counselor Caz L. Craffy was ordered to pay millions in restitution and forfeiture after defrauding Gold Star families through unauthorized and high-risk trading.
paragraph
Caz L. Craffy was charged with violating the Securities Act of 1933 and the Securities Exchange Act of 1934 for managing accounts for Gold Star families through unsuitable, high-risk strategies. His actions resulted in approximately $1.79 million in realized losses, including $1.64 million in personal fees and commissions. In parallel criminal proceedings, Craffy was sentenced to 151 months in prison and ordered to pay $1,482,741.41 in forfeiture and $4,085,988.32 in restitution.
narrative
Former U.S. Army financial counselor Caz L. Craffy defrauded Gold Star family members by directing their benefits into brokerage accounts he managed to facilitate unauthorized and excessive trading. Between 2018 and 2022, Craffy utilized his position to recommend high-risk strategies that resulted in $1.79 million in losses, with $1.64 million of that amount consisting of fees and commissions paid largely to himself. He faced charges for violating Sections 17(a) of the Securities Act of 1933 and 10(b) of the Securities Exchange Act of 1934. In a parallel criminal case, Craffy was sentenced to 151 months in prison and ordered to pay over $5.5 million in combined forfeiture and restitution. Following these criminal mandates, the SEC obtained final judgment and concluded its litigation by opting not to pursue additional separate monetary claims. This final judgment concludes the SEC's enforcement action against Craffy.
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Parties
SABELLA3M COMPANY
Keywords
craffysecurities exchangeexchange commissionfamily memberssecuritiesseccazexchangejulymembersarmy financialfinancial counselorgold starstar familyparallel criminal
Exhibits & Attached Documents (1)
Extracted insights
Dollar amounts 4
- $4.09M $4,085,988 $1M–$10M
- $1.79M $1.79 million $1M–$10M
- $1.64M $1.64 million $1M–$10M
- $1.48M $1,482,741 $1M–$10M
Entities 3
- person Caz L. Craffy
- agency Securities and Exchange Commission
- agency the sec not to pursue its remaining monetary claims against caz l. craffy
Triples 10
- Securities And Exchange Commission obtained a judgment against Caz L. Craffy
- Securities And Exchange Commission charged Caz L. Craffy with defrauding Gold Star family members and others by engaging in unauthorized trading in customer accounts and recommending excessive trades and high-risk strategies that did not match customers’ investment profiles
- United States Of America sentenced Caz L. Craffy to 151 months in prison followed by 3 years of supervised release and ordered to pay $1,482,741.41 in forfeiture
- Court ordered Caz L. Craffy to pay $4,085,988.32 in restitution
- Securities And Exchange Commission advised the Court it does not intend to pursue its remaining monetary claims against Caz L. Craffy
- Court ordered the SEC not to pursue its remaining monetary claims against Caz L. Craffy
- Caz L. Craffy directed grieving family members to transfer their benefits into brokerage accounts he managed
- Caz L. Craffy engaged in unauthorized and excessive trading that exposed his customers to higher risks of loss, resulting in realized losses of approximately $1.79 million
- Caz L. Craffy received approximately $1.64 million in fees and commissions, most of which were paid to him personally
- Securities And Exchange Commission charged Caz L. Craffy with violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rules 10b-5 and 15l-1(a)(1) thereunder
PDF (from attached: complaint)
Text layers
Extracted body text (2,381c)
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26363 / July 29, 2025 Securities and Exchange Commission v. Caz L. Craffy, No. 3:23-cv-03639 (D.N.J. filed July 7, 2023) SEC Obtains Final Judgment Against Former Army Financial Counselor Who Defrauded Gold Star Family Members On September 4, 2024, the Securities and Exchange Commission obtained a judgment against defendant Caz L. Craffy, whom the SEC previously charged with defrauding Gold Star family members and others by engaging in unauthorized trading in customer accounts and recommending excessive trades and high-risk strategies that did not match customers’ investment profiles. In a parallel criminal proceeding, United States v. Craffy, Crim. No. 23-541 (D.N.J.), on August 22, 2024, Craffy was sentenced to 151 months in prison followed by 3 years of supervised release and ordered to pay $1,482,741.41 in forfeiture, and on January 7, 2025, he was ordered to pay $4,085,988.32 in restitution. In light of Craffy’s sentence, forfeiture, and restitution in the parallel criminal proceeding, on July 14, 2025, the SEC advised the Court that it does not intend to pursue its remaining monetary claims against Craffy, which the Court ordered on July 16, 2025. This concludes the SEC’s litigation in this matter. According to the SEC’s complaint, Craffy was permitted to provide general financial education to service members’ families through his job as a U.S. Army financial counselor. However, as alleged, between May 2018 and November 2022, Craffy directed grieving family members to transfer their benefits into brokerage accounts he managed while working full-time for private brokerage firms. Once the funds were transferred, Craffy allegedly engaged in unauthorized and excessive trading that exposed his customers to higher risks of loss, resulting in realized losses of approximately $1.79 million, including approximately $1.64 million in fees and commissions, most of which were paid to Craffy personally. The complaint charged Craffy with violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rules 10b-5 and 15l-1(a)(1) thereunder. The SEC's litigation was handled by Hayden M. Brockett, Bari R. Nadworny, Ariel Atlas, and Liora Sukhatme, and was supervised by Sheldon L. Pollock and Jack Kaufman, all of the New York Regional Office.
OCR text (2,381c · html-text · 99% conf)
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26363 / July 29, 2025 Securities and Exchange Commission v. Caz L. Craffy, No. 3:23-cv-03639 (D.N.J. filed July 7, 2023) SEC Obtains Final Judgment Against Former Army Financial Counselor Who Defrauded Gold Star Family Members On September 4, 2024, the Securities and Exchange Commission obtained a judgment against defendant Caz L. Craffy, whom the SEC previously charged with defrauding Gold Star family members and others by engaging in unauthorized trading in customer accounts and recommending excessive trades and high-risk strategies that did not match customers’ investment profiles. In a parallel criminal proceeding, United States v. Craffy, Crim. No. 23-541 (D.N.J.), on August 22, 2024, Craffy was sentenced to 151 months in prison followed by 3 years of supervised release and ordered to pay $1,482,741.41 in forfeiture, and on January 7, 2025, he was ordered to pay $4,085,988.32 in restitution. In light of Craffy’s sentence, forfeiture, and restitution in the parallel criminal proceeding, on July 14, 2025, the SEC advised the Court that it does not intend to pursue its remaining monetary claims against Craffy, which the Court ordered on July 16, 2025. This concludes the SEC’s litigation in this matter. According to the SEC’s complaint, Craffy was permitted to provide general financial education to service members’ families through his job as a U.S. Army financial counselor. However, as alleged, between May 2018 and November 2022, Craffy directed grieving family members to transfer their benefits into brokerage accounts he managed while working full-time for private brokerage firms. Once the funds were transferred, Craffy allegedly engaged in unauthorized and excessive trading that exposed his customers to higher risks of loss, resulting in realized losses of approximately $1.79 million, including approximately $1.64 million in fees and commissions, most of which were paid to Craffy personally. The complaint charged Craffy with violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rules 10b-5 and 15l-1(a)(1) thereunder. The SEC's litigation was handled by Hayden M. Brockett, Bari R. Nadworny, Ariel Atlas, and Liora Sukhatme, and was supervised by Sheldon L. Pollock and Jack Kaufman, all of the New York Regional Office.