SEC charges San Diego-area adviser with $7 million Ponzi scheme

Christopher D. Dougherty charged with defrauding clients with fake private placements

Apr 29, 2019 @ 1:59 pm

By InvestmentNews

The Securities and Exchange Commission has charged a San Diego-area adviser with operating a Ponzi scheme that defrauded his investment advisory clients out of $7 million.

The SEC alleges that Christopher D. Dougherty and his firm, C&D Professional Services, offered about 50 clients — most of whom were school district employees, hospital employees, veterans and neighbors, and largely unsophisticated investors — the opportunity to invest in tax-free "private placements" that purportedly provided quarterly dividends of about 5%.

Mr. Dougherty, 45, also has been charged criminally for his conduct by the San Diego District Attorney's Office.

More: Sales of unregistered securities are a growing problem that's harming investors — and the industry

The SEC complaint alleges that there were no private placements and that the Poway, Calif.,-based Mr. Dougherty was simply running a Ponzi scheme. The SEC said he took new investor money and used it to pay quarterly dividends to existing investors, while also spending some of the money on his personal expenses.

According to the complaint, he also offered investors the opportunity to invest in his farm and his real estate business. Those funds were commingled with the private placement investments and used as part of the Ponzi scheme fraud as well, the SEC said.

In 2012, Mr. Dougherty pleaded guilty to a misdemeanor conviction for fraudulent appropriation from a charitable organization. He and his wife filed for personal bankruptcy in October 2018.


What do you think?

View comments

Most watched


Young advisers envision a radically different business in five years

Fintech and sustainable investing are two factors being watched closely by some of the 2019 class of InvestmentNews' 40 Under 40.


Young professionals see lots of opportunity to reinvent the advice experience

Members of the 2019 InvestmentNews class of 40 Under 40 have strategies to overcome the challenges of being young in a mature industry.

Latest news & opinion

InvestmentNews' 2019 class of 40 Under 40

Our 40 Under 40 project, now in its sixth year, highlights young talent in the financial advice industry. These individuals illustrate the tremendous potential of those coming up in the profession. These stories will surprise, entertain, educate and inspire.

Galvin to propose fiduciary rule for Massachusetts brokers

The secretary of the commonwealth is proposing a fiduciary standard in response to an SEC investment-advice rule he views as too weak.

Summer reading recommendations from financial advisers

Here are some books that will keep you informed and entertained during summer's downtime

4 strategies for Roth conversions

There's never been a better time to do a Roth conversion, and here are several ways to go about it.

Cetera latest to be hit with data breach of personal information

Company is offering clients complimentary, two-year membership to an identity theft protection and credit monitoring service.


Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting It'll help us continue to serve you.

Yes, show me how to whitelist

Ad blocker detected. Please whitelist us or give premium a try.


Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print