Advisers charged with 'gambling away' millions from clients

Massachusetts securities regulators have charged two investment adviser representatives and their firm, Oakdale Wealth Management, with "gambling away" millions of dollars on unsuitable energy investments from more than 250 client accounts. Regulators charged James G. Daly of Franklin, Mass., and Michael J. O'Keeffe of Millis, Mass., with violating their fiduciary duties to their investors — a majority of whom were state residents and many of whom were also elderly — by investing in high-risk energy investments, such as oil and natural gas. (More:​ Ex-broker stole $100,000 from client, Galvin says) The complaint alleges that despite warnings about the potential volatility of the energy sector, Mr. Daly, who handled most of the investment advisory business, over-concentrated nearly every client in energy investments, regardless of age, risk tolerance, and net worth. In many cases, more than 30% of the client's portfolio was made up of energy-related investments, the state's Securities Division said in a release. The state said that Mr. O'Keeffe, who acted as the firm's compliance officer, failed to perform any meaningful review of Mr. Daly's actions, though Oakdale's policies and procedures stated that the firm would tailor investment decisions based on each client's risk tolerance, the complaint states. (More:​ Galvin investigating 63 broker-dealers selling private placements from GPB Capital) The Securities Division is seeking to have Mr. Daly and Mr. O'Keeffe fined and censured. It is also seeking to have Mr. Daly permanently barred from registration in Massachusetts. Also being sought is the disgorgement of all profits from the alleged wrongdoing and restitution to Massachusetts investors for their losses.