A Los Angeles-based investment advisor and his firm overcharged clients so that he could lease two Mercedes-Benz vehicles and pay for overseas trips, the Securities and Exchange Commission said in a complaint released Thursday.
Marc D. Broidy and his firm Broidy Wealth Advisors fraudulently overbilled clients and was stealing assets from their trusts since 2011 to pay for such personal expenses as his home mortgage, trips and cars, the complaint says. Broidy allegedly billed clients approximately $643,000 in excess fees and covered it up by altering the amount of management fees recorded on forms issued by brokerage firms before sending the forms to his clients.
The SEC further alleges that Broidy fraudulently obtained additional funds to pay his personal expenses by misappropriating approximately $865,000 in assets from clients' trusts, for which he was trustee. According to the SEC's complaint, Broidy also misled advisory clients about some investments they made in privately held companies when he didn't inform them he was affiliated with those companies.
In a parallel action, the U.S. Attorney's Office for the Eastern District of New York has filed criminal charges against Broidy.