Securities Lawyers Blog
The law offices of Gana Weinstein LLP are currently investigating claims made by The Securities and Exchange Commission (SEC) in which the agency charged a Pennsylvania investment adviser, Brenda Smith (Smith) with operating an investment advisory fraud involving over $100 million in investments. In conjunction with the SEC action the regulatory obtained an emergency asset freeze in order to preserve investor funds.
The SEC’s complaint alleges that Brenda Smith, and her fund Broad Reach Capital, LP, (Broad Reach Capital) raised $105 million from approximately 40 investors by representing that she would invest their money in publicly traded securities through various trading strategies that were promoted as providing consistent high returns. The SEC found that Smith instead made very few investments in these trading strategies and largely used investors’ money to repay other investors and for her own personal investments. The SEC alleged that Smith through entities she controlled disseminated false statements in order to tout positive returns and fabricated documents in an attempt to inflate Broad Reach Capital’s assets in order to lull investors into believing their capital was safe.
The SEC’s complaint charges Smith, Broad Reach Capital, the fund’s general partner Broad Reach Partners, LLC, and the adviser, Bristol Advisors, LLC with violating the anti-fraud provisions of the federal securities laws.