Father and son hedge fund managers have been charged with defrauding investors in a $10.7 million hedge fund, the Securities and Exchange Commission announced Tuesday.

Thomas D. Conrad Jr. and his son, Stuart P. Conrad, of Alpharetta, Ga., and their two unregistered advisory firms, Financial Management Corporation (based in the United States) and Financial Management Corporation S.R.L. (based in Uruguay), are named in the charge.

According to the complaint, between 2010 and late 2014, Thomas Conrad directed preferential redemptions and other disbursements out of the hedge fund and its feeder funds to himself, to Stuart Conrad, to other family members and to favored clients, while telling other investors that redemptions had been suspended.

In addition, the SEC says Thomas Conrad arranged to increase his compensation from the hedge fund by appointing himself as a sub-manager, for a fee, and that this additional fee and the related conflict of interest were not disclosed to investors. The complaint also alleges that, without disclosure to investors, Thomas Conrad titled certain fund assets in his name, rather than the fund's name.

Stuart Conrad aided and abetted in these violations, the SEC says. The complaint does not say how much of the money from investors was misappropriated.