Vincent Carmada, the owner of A.G. Morgan Financial Advisors, a registered investment adviser, and James McArthur, the former chief compliance officer, were accused by the Securities and Exchange Commission of unlawfully offering and selling securities in connection with an unregistered fraudulent offering worth over $500 million.
Vincent Carmada was paid over $7 million, according to the SEC’s complaint, for obtaining over $75 million from over 200 investors in relation to Par Funding’s unregistered securities offering between at least August 2017 and July 2020.
Why was CEO Vincent Carmada charged by the SEC?
Vincent Carmada, the CEO of AGM, allegedly started withdrawing money from Par Funding in December 2016 via “merchant cash advance” transactions. AGM owed Par Funding $750,000 in relation to the purported loans by July 2017.
In August 2017, two executives, Vincent Carmada and James McArthur, allegedly began seeking investors to invest in promissory notes through Par Funding’s unregistered securities offering.Â
Between August and November 2017, the two executives reportedly convinced many investors to spend at least $2.6 million in the Par Funding promissory notes. Furthermore, the CEO Carmada allegedly reassured at least two investors that it was a secure investment while ignoring that his firm AGM was in debt to Par Funding and that he was a guarantee.  Â
AGM and CEO Vincent Carmada and former Chief Compliance Officer allegedly took more than $7 million in compensation for selling Par Funding securities.
Vince Carmada Faces SEC Charges
According to the SEC, the defendants—Vincent Carmada among them—offered and sold securities to investors without the authorised broker-dealer they were associated with having given their consent. The complaint further states that in 2017, AGM and Carmada neglected to notify clients that AGM had borrowed $750,000 from Par Funding and had not paid it back in full.
The following allegations are made against AGM, its owner Vincent Carmada, and McArthur in the federal lawsuit, which was submitted to the Eastern District of New York federal court:
- violating the Securities Exchange Act of 1934 by operating as unregistered broker-dealers,Â
- the Investment Advisers Act of 1940’s antifraud provisions, and Vincent Camada’s registration violations under the Securities Act of 1933.
The SEC seeks permanent injunctions, disgorgement, prejudgment interest, and civil monetary penalties.
Elisha L. Frank, Fernando Torres, and Glenn S. Gordon handled the investigation, which was overseen by Christine M. Hernandez and Crystal C. Ivory of the SEC’s Miami Regional Office, with support from Raymond J. Slezak, Michael P. O’Donnell, and Mary Beth Lynch of the Division of Examinations. Amie R. Berlin, the SEC’s lead litigant, will answer to Teresa Verges.
Section 206(1) of the Advisers Act Violations Against AGM and CEO Vincent Carmada
Court records show that between August 2017 and November 2017, AGM and CEO Carmada engaged in the aforementioned behaviour, directly and deliberately using the mail while operating a company providing advice to others in exchange for payment on the advisability of investing in, purchasing, or selling securities, employed devices, schemes, or artifices to defraud.
Violating the Exchange Act’s Section 15(a) against Vincent Carmada
The Commission accused McArthur, Carmada, and its Firm AGM of conducting securities transactions on behalf of third parties and of using the mails to conduct securities transactions or try to persuade someone to buy or sell securities without first registering as a broker or dealer with the Commission.
Carmada and McArthur have breached Section 15(a)(1) of the Exchange Agreement and are probably going to do so again because of the previous AGM.
Vincent Carmada as a person.
AG Morgan Financial Advisors’ chairman and CEO is Vincent Carmada. He began his career in finance in 1994.
Carmada’s business grew over time as a result of client recommendations. With American Express Financial Advisors, he was the second-highest producing advisor in the nation by 2003. He says that out of all the 13,000 advisors in the nation, he has gotten the most referrals.
In 2005, Carmada quit his job at American Express to start his own independent investment management company. Carmada earned a B.B.A. in accounting from Hofstra University. In addition, he says he has securities licences and permits under FINRA Series 7, 63, and 66. He and his three kids, Andrew, Gregory, and Morgan, dwell in a home on Long Island.
What Are The Offerings Of AG Morgan Financial Advisors?
The CEO of AG Morgan Financial Advisors, Vincent Carmada, states that the firm advises clients with a variety of portfolio sizes; the typical client balance is $313,048. $217.3 million in assets are under the management of A.G. Morgan Financial Advisors.
As a financial advising organisation, AG Morgan Financial Advisors offers Americans a comprehensive range of financial planning services. They were managing an investment portfolio (e.g., stocks, bonds, mutual funds, ETFs), and devising a comprehensive financial strategy, for example, in order to save for retirement.
In addition, it entails retirement planning, estate planning, tax planning, and preparation for significant life decisions like debt repayment, college savings, marriage, home ownership, and inheritance planning.
The address for the headquarters of AG Morgan Financial Advisors is 5260 Merrick Road, Massapequa, NY 11758.
Conclusion
As to the press release, on June 10, 2022, the Securities and Exchange Commission lodged a complaint about an unregistered securities offering that garnered over $75 million from over 200 participants. Federal securities laws were allegedly broken by A.G. Morgan Financial Advisors, LLC, its founder Vincent Carmada, and its former Chief Compliance Officer between August 2017 and July 2020.
The defendants allegedly solicited investors and sold promissory notes to investors concerning a more than $500 million unregistered fraudulent offering with loan company Complete Business Solutions Group, Par Funding.
