A registered investment advisor and one of its former investment advisors have settled charges by the Securities and Exchange Commission for breaching fiduciary duties.
One Oak Capital Management, LLC, and Michael DeRosa were accused of misconduct after an SEC investigation concluded that more than 180 brokerage accounts for clients of DeRosa at an unregistered broker-dealer he was simultaneously employed by, were transferred to One Oak as advisory accounts.
The mostly elderly long-time clients of DeRosa’s whose accounts were transferred were not informed that the advisory accounts would have significantly higher fees than the brokerage accounts, or that DeRosa would receive higher commission. The conflict of interests was also not revealed.
The SEC Order states that the conversations took place between approximately June 2020 and October 2023 and resulted in higher fees without additional benefits. It found that neither the RIA nor DeRosa had adequately considered whether the change to advisory accounts would be in the best interests of the clients.
Although the firm’s policies required investment management agreements that stated fee schedules, the order also notes that DeRosa had provided some clients with IMAs that did not have fee information, or an assistant under his supervision added this in once forms had been signed by clients.
One Oak Capital Management did not admit or deny the charges but agreed to pay a $150,000 civil penalty and to retain an independent compliance consultant to conduct a review of certain policies and procedures relating to its retail business.
DeRosa also did not admit or deny the charges but agreed to pay a $75,000 civil penalty and to be suspended from the industry for nine months. He has no disciplinary history with the SEC.
One Oak Capital Management was founded in 2013 and focuses on “institutionally oriented investment strategies that are not readily available to most investors” according to its website.
Meanwhile, DPL Financial Partners adds two annuity executives and Prime Capital Financial hires a Mid-Atlantic retirement plan consultant
Andrew Komarow pleaded guilty Thursday in federal court in Hartford to defrauding three financial services companies of close to $3.3 million.
Elsewhere, Cetera picks up a $210 million Connecticut team from MML, while Wells Fargo FiNet adds a San Diego family practice from LPL
Celebrity endorsements, $500M in claimed assets, and a state regulator stepping in.
“We needed to become a more agile and efficient organization,” said American Express CEO Stephen Squeri.
Knighthead Life entered the market with a competitive MYGA. A strong launch earned advisor confidence and paved the way for FIAs.
As AI makes financial information more accessible than ever, Lana Hock explains why human judgment, trust, and empathy remain the qualities clients value most in a financial advisor
