A disgraced broker who reportedly stole over $700,000 from an elderly investor is now on the wrong end of an official court decision, according to the SEC.
The federal securities regulator revealed on Tuesday that the US District Court for the Eastern District of New York has issued a final judgment against Rand Heckler, a former broker who's been permanently banned from the industry.
The judgment stems from a complaint the SEC filed against Heckler on September 30, 2020. According to the complaint, since at least 2015, Heckler deceived an elderly investor and the investor’s son into investing over $700,000.
He reportedly did this by falsely claiming to manage a thriving hedge fund under his company, Rand Heckler, Inc. However, the SEC’s investigation revealed that Heckler never managed any hedge fund.
According to the SEC’s 2020 complaint, which named Heckler and his now-defunct company as defendants, Heckler periodically provided the investor and his son with fabricated account statements showing investments in stocks and other securities.
With those statements, they were encouraged to entrust at least $755,000 to the fraudulent hedge fund between 2015 and 2020. The SEC said Heckler misappropriated the majority of the funds for personal use, including covering mortgage and car payments, as well as financing a country club membership.
The scheme started to unravel when Finra barred Heckler in 2019 for failing to provide information to the relating to a complaint against him by a different investor. Upon learning of his prohibition, the son grew suspicious and demanded that Heckler give back part of his father’s investment.
“Unable to meet this redemption demand, Heckler solicited a new $100,000 investment from the wife of a former brokerage customer,” the SEC complaint said.
Heckler reportedly persuaded the wife to transfer the $100,000 into a bank account he said was associated with a dividend-paying investment opportunity. But the account, according to the SEC, actually belonged to the senior investor, whom Heckler repaid “in a Ponzi-like fashion.”
The SEC charged Heckler for violating several provisions of federal securities laws, including Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and specific sections of the Investment Advisers Act of 1940.
The court’s judgment affirmed those charges in its judgment issued August 12, enjoining Heckler from breaching those federal securities laws in the future.
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