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Tuesday, November 29, 2022

SEC Bars Former LPL Rep After Responsible Plea for $2.8M Fraud

The Securities and Change Fee (SEC) barred a Mass.-based funding advisor, previously affiliated with LPL, that stole greater than $2.8 million from purchasers.

The settlement with the SEC comes practically three months after James Ok. Couture pleaded responsible to 4 counts of wire fraud, 4 counts of aggravated id theft, one rely of funding advisor fraud and one rely of witness tampering in Mass. federal courtroom, in response to the Justice Division. 

Couture, who lived in Sutton, Mass. is the founder and proprietor of the Non-public Wealth Administration Group and was a twin registrant with LPL from 2009 to his firing in June 2020, in response to the SEC’s settlement order. Couture had multi-year stints with Lincoln Monetary Group and New England Securities earlier than becoming a member of LPL, in response to his BrokerCheck profile.

In keeping with the DOJ, Couture operated as an RIA out of an workplace in Worcester, investing purchasers in varied insurance coverage merchandise, together with annuities, however all through his time at LPL, he misappropriated funds from purchasers for his personal bills. 

To take action, Couture would advise purchasers to speculate their funds in sub-accounts managed by an unnamed LPL-authorized sub-advisor, and started convincing purchasers to promote elements of their funds to “Legacy Monetary Group,” claiming he’d reinvest them for higher earnings. However Couture failed to inform purchasers he’d shaped Legacy Monetary in 2009, and neither LPL or the sub-advisor had approved Couture to make use of it as a third-party advisor for purchasers. 

By promoting different purchasers’ holdings, he would pay funding returns and different wants; in 2016, Couture liquidated all of a consumer’s variable annuities to fund a separate consumer’s withdrawals; in Dec. 2019 and Jan. 2020, Couture paid a previously-defrauded consumer by promoting the mutual funds of different purchasers. Couture would forge signatures on paperwork, or get purchasers to signal paperwork by mendacity about how the proceeds of a transaction would profit them, in response to the DOJ.

Couture was charged in June 2021 with wire fraud and aggravated id theft in Massachusetts federal courtroom. After fees have been filed, Couture created faux paperwork he claimed have been for his purchasers’ accounts and continued to offer false info to one in all his victims for an additional six months, main the DOJ so as to add fees of witness tampering in opposition to the advisor this previous January.

Couture couldn’t be reached for remark, and his most up-to-date legal professional is listed as having ended his work with the advisor in January 2022.

Couture’s Non-public Wealth Administration Group was by no means registered with the fee or with state regulators; whereas Legacy Monetary was shaped as an LLC in New Hampshire, the New Hampshire Division of State administratively dissolved it in 2013, in response to the SEC. FINRA additionally barred Couture from the trade in Oct. 2020.

Couture faces many years in jail because of his responsible plea in September. The wire fraud fees permit for as much as 20 years in jail, in addition to three years of supervised releases, whereas the aggravated id theft fees vary as much as two years, the funding advisor fraud fees contain sentences as excessive as 5 years, and the witness tampering fees carry a possible sentence of 20 years in jail. Couture’s scheduled to be sentenced early subsequent yr.


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