SEC v. Jeremy Joseph Drake; and Jeremy Drake, No. LR-23915, Central District of California (Aug. 22, 2017) — Press Release
raw: Jeremy Joseph Drake
Jeremy Joseph Drake, No. LR-23915 (Aug. 22, 2017)
Jeremy Joseph Drake, an investment adviser, defrauded a professional athlete and his wife by deceiving them about investment advisory fees, resulting in $1.2 million in overpaid fees and a $900,000 gain for Drake, who now faces SEC charges.
Jeremy Joseph Drake, an investment adviser, allegedly defrauded a professional athlete and his wife by deceiving them about investment advisory fees, resulting in $1.2 million in overpaid fees. Drake personally received approximately $900,000 in incentive-based compensation tied to the inflated fees. The SEC charged Drake with violating the anti-fraud provisions of the Investment Advisers Act of 1940, and is seeking a permanent injunction, return of ill-gotten gains, and penalties.
Jeremy Joseph Drake, an investment adviser, allegedly defrauded a professional athlete and his wife by deceiving them about investment advisory fees. Drake falsely claimed they paid a discounted 'VIP' fee of 0.15-0.20% on assets under management, when in reality they paid 1%, resulting in $1.2 million in overpaid fees. To conceal the fraud, Drake fabricated documents, sent misleading fee reports, and impersonated a fictitious person named 'Ron Stenson' to validate his lies. Drake personally received approximately $900,000 in incentive-based compensation tied to the inflated fees. The SEC alleged violations of Sections 206(1) and 206(2) of the Investment Advisers Act of 1940 and is seeking a permanent injunction, disgorgement of ill-gotten gains with interest, and civil penalties. Drake admitted to the deception after being confronted and threatened the client with reputational harm if she reported him. The SEC's investigation, which is continuing, has been conducted by M. Lance Jasper and Spencer E. Bendell, and the litigation will be led by Kristin Escalante.
Exhibits & Attached Documents (1)
Extracted insights
- $1.20M $1.2 million $1M–$10M
- $900K $900,000 $100K–$1M
- person jeremy drake
- SEC charged Jeremy Drake
- Jeremy Drake defrauding professional athlete and his wife
- SEC alleges Drake went to elaborate lengths to conceal his fraud
- Jeremy Joseph Drake defrauded a high profile professional athlete and the athlete's wife
- SEC charged Jeremy Joseph Drake with defrauding clients by concealing investment advisory fees
- Jeremy Joseph Drake charged with defrauding two clients
- Jeremy Joseph Drake defrauding a high profile professional athlete and the athlete's wife
- Jeremy Joseph Drake conceal his fraud
- Securities and Exchange Commission charged Jeremy Joseph Drake
- Securities and Exchange Commission alleges that Drake went to elaborate lengths to conceal his fraud
- Jeremy Joseph Drake deceiving them about the investment advisory fees they were paying
- SEC charged Jeremy Drake with defrauding Professional Athlete and his Wife
- Jeremy Drake defrauding two clients, a high profile professional athlete and the athlete's wife
- SEC alleges Drake went to elaborate lengths to conceal his fraud
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 23915 / August 22, 2017 Securities and Exchange Commission v. Jeremy Joseph Drake, No. 17-cv-06204 (C.D. Cal., filed August 22, 2017) SEC Charges Investment Adviser with Defrauding Professional Athlete and his Wife The Securities and Exchange Commission today charged investment adviser Jeremy Drake with defrauding two clients, a high profile professional athlete and the athlete's wife, by deceiving them about the investment advisory fees they were paying. The SEC alleges that Drake went to elaborate lengths to conceal his fraud, including creating and sending false documents and masquerading as another person to corroborate his lies. The SEC alleges that Drake, then with Los Angeles-based HCR Wealth Advisors, deceived the clients for more than three years, telling them that they paid a special "VIP" annual rate of 0.15 to 0.20 percent of their assets under management when in fact they paid 1 percent. Drake's deception led the clients to pay $1.2 million more in management fees than Drake represented. Drake personally received approximately $900,000 of incentive-based compensation based on the fees paid by the clients during the course of his deception. According to the SEC's complaint filed in the U.S. District Court for the Central District of California, Drake repeatedly lied to the clients and their representatives and sent false and misleading emails, deceptive fee reports, and other fabricated documents. The complaint alleges that in June 2016, as one of the clients demanded an explanation about the fees, Drake created the persona of "Ron Stenson," who purportedly corroborated Drake's story. Upon discovery, the complaint alleges that Drake admitted to one of the clients that he had been lying and warned her that reporting his misconduct could result in bad publicity for her husband. The SEC charged Drake with violating the anti-fraud provisions of the Investment Advisers Act of 1940, Sections 206(1) and 206(2), and with aiding and abetting violations of those provisions. The SEC is seeking a permanent injunction, return of Drake's allegedly ill-gotten gains plus interest, and penalties. The SEC's investigation, which is continuing, has been conducted by M. Lance Jasper and Spencer E. Bendell, and the litigation will be led by Kristin Escalante. SEC Complaint
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 23915 / August 22, 2017 Securities and Exchange Commission v. Jeremy Joseph Drake, No. 17-cv-06204 (C.D. Cal., filed August 22, 2017) SEC Charges Investment Adviser with Defrauding Professional Athlete and his Wife The Securities and Exchange Commission today charged investment adviser Jeremy Drake with defrauding two clients, a high profile professional athlete and the athlete's wife, by deceiving them about the investment advisory fees they were paying. The SEC alleges that Drake went to elaborate lengths to conceal his fraud, including creating and sending false documents and masquerading as another person to corroborate his lies. The SEC alleges that Drake, then with Los Angeles-based HCR Wealth Advisors, deceived the clients for more than three years, telling them that they paid a special "VIP" annual rate of 0.15 to 0.20 percent of their assets under management when in fact they paid 1 percent. Drake's deception led the clients to pay $1.2 million more in management fees than Drake represented. Drake personally received approximately $900,000 of incentive-based compensation based on the fees paid by the clients during the course of his deception. According to the SEC's complaint filed in the U.S. District Court for the Central District of California, Drake repeatedly lied to the clients and their representatives and sent false and misleading emails, deceptive fee reports, and other fabricated documents. The complaint alleges that in June 2016, as one of the clients demanded an explanation about the fees, Drake created the persona of "Ron Stenson," who purportedly corroborated Drake's story. Upon discovery, the complaint alleges that Drake admitted to one of the clients that he had been lying and warned her that reporting his misconduct could result in bad publicity for her husband. The SEC charged Drake with violating the anti-fraud provisions of the Investment Advisers Act of 1940, Sections 206(1) and 206(2), and with aiding and abetting violations of those provisions. The SEC is seeking a permanent injunction, return of Drake's allegedly ill-gotten gains plus interest, and penalties. The SEC's investigation, which is continuing, has been conducted by M. Lance Jasper and Spencer E. Bendell, and the litigation will be led by Kristin Escalante. SEC Complaint