- Stephen Anderson defrauded clients due to overcharging advisory fees by $367k.
- Anderson owned River Source Wealth, a now-defunct investment advisory firm.
- The fees were based on each customer’s assets under management, as agreed.
- Order finds, that during 2015 to 2016, Anderson overcharged most of his clients.
- The amounts and percentages of the overcharges varied, but, in the aggregate,
amounted to 40% more than the agreed-upon maximum customer advisory fees.
- Clients were also misled about the reason that he transferred their assets, from
the company’s long-time asset custodian falsely stating that the decision was his.
- In fact, the asset custodian ended the relationship after noticing irregular billing
practices and did not receive enough supporting documentation to justify these.
- Anderson overstated the assets under management by at least $34mn in 2015,
by $61mn in 2016, and failed to implement compliance policies and procedures.
- Anderson will pay disgorgement and interest of $405k, and a penalty of $100k.