The Securities and Exchange Commission today announced it has charged former Minneapolis-area financial advisor Isaiah L. Goodman with allegedly stealing about $2.25 million from his clients and spending the money on business and personal expenses, including a hot tub and cruises.

In a parallel action today, the U.S. Attorney's Office for the District of Minnesota filed criminal charges against Goodman.

The SEC said Goodman, 33, of Maple Grove, Minn., operated his business as a one-man shop through Becoming Financial Advisory Services LLC when he allegedly defrauded about 20 clients from at least September 2018 to November 2020.

The SEC complaint said Goodman falsely represented that he would invest his clients’ funds for their retirement and investment accounts in securities ranging from mutual funds and annuities to stocks and fixed-income securities. His firm's brochure said Becoming Financial used long-term trading as its investment strategy.

According to the SEC, clients would transfer their investments to bank accounts in the name of Becoming Financial—which was controlled by Goodman—via wire transfer, Automated Clearing House transfer or by writing a check to Becoming Financial.

The complaint alleges that Goodman deceived his clients by creating and providing them with fake account statements and computer screenshots purporting to show their funds were appropriately invested and their accounts had appreciated in value.

In one instance, two clients who hired Goodman for their combined account received from Goodman several purported computer screenshots falsely showing that their Investment Retirement Account had been invested in various mutual funds, and that its value had grown to $402,000. In another case, a client received at least one account statement on Becoming Financial letterhead falsely showing that her initial investment had grown to $600,466.37 and had been invested in various stocks and mutual funds as of June 30.

In reality, according to the complaint, Goodman was using his clients’ money for personal expenses, including payments to homebuilders and interior decorators, as well as for furniture, a hot tub, Royal Caribbean cruises, credit card payments, rent and transfers to family members. He also made Ponzi-like payments to certain clients after receiving new investments from other clients, the complaint said.

The SEC's complaint, filed in federal district court in Minnesota, charges Goodman with violating the antifraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. It seeks injunctive relief, disgorgement with pre-judgment interest and civil penalties.