Massachusetts fines RIA $225,000 over conflicted advice
Principals of Wellesley firm recommended buying stock of company in which they had an interest.
Strategic Planning Group Inc., a Wellesley, Mass.-based registered investment adviser, has been censured and fined $225,000 by state regulators over conflicted investment advice the firm offered its clients.
The RIA’s principals, David Alexander Rourke Sr. and Jarrod Andrew Sherman, made recommendations to clients to purchase stock in Ecoark Holdings, a company for which the two served as consultants and in which they had a financial interest, the state’s chief securities regulator, William Galvin, said in a release.
According to a consent order, the firm’s investment adviser representatives recommended that clients invest up to 5% of their portfolio in Ecoark, in which Mr. Rourke had invested $800,000 and which Mr. Sherman, the firm’s chief compliance officer, had invested approximately $300,000.
The consent order noted that forms filed by the firm stated explicitly that the company did not buy or sell securities that it also recommended to its advisory clients.
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