Securities Lawyers Blog
The Securities and Exchange Commission (SEC) recently filed a complaint against former Gradient Securities, LLC (Gradient) and Cambridge Investment Research, Inc. (Cambridge) broker Terry Bahgat (Bahgat) working out of the Amherst, New York. The SEC alleged that from December 2014 through September 2016, Bahgat misappropriated funds seven different clients by obtaining access to their brokerage accounts and then transferring either to himself or WealthCFO – a company that Bahgat controlled. Bahgat operated his advisory business through WealthCFO Advisors, LLC and other firm WealthCFO Partners, LLC.
According to the SEC, in order to effectuate the fraud in some cases Bahgat had his assistant pose as his clients on telephone calls with the brokerage firms in order to obtain bill paying privileges. The SEC alleged that Bahgat’s scheme continued until September 2016 when he then fled the U.S. for Egypt. The Financial Industry Regulatory Authority (FINRA) also barred Bahgat from the securities industry after he failed to respond to a request for information in January. The FINRA investigation involved a different questionable practice – whether Bahgat made misrepresentations in the sale of a variable annuity.
Bahgat entered the securities industry in 1986. From October 2010 until August 2015, Bahgat was associated with Cambridge. From July 2015 until October 2016, Bahgat was registered with Gradient.