SEC says RIA stole $1 million from clients, using some of it to support gambling habit

Scott Newsholme allegedly stole $1 million, using funds for personal expenses, a gambling habit and to pay back early investors.
SEP 07, 2017

The Securities and Exchange Commission has charged a New Jersey-based tax preparer and RIA with stealing more than $1 million from clients to support his gambling habit and other personal expenditures. The SEC alleges that Scott Newsholme, a registered investment adviser in Farmingdale, N.J., fabricated account statements, doctored stock certificates, and forged promissory notes as part of a scheme in which he persuaded his planning clients to invest in various securities. Instead of investing the money, Mr. Newsholme allegedly cashed their investment checks at a check-cashing store, assured clients that their assets were safe and then used the money for personal expenses, gambling in Atlantic City, and Ponzi-like payments to clients who sought a return of their funds. In a parallel action, the U.S. Attorney's Office for the District of New Jersey has announced criminal charges against Mr. Newsholme. In its civil action, the SEC seeks the disgorgement of ill-gotten gains plus interest, penalties, and permanent injunctions.

Latest News

Edward Jones facing more race bias claims in new lawsuit
Edward Jones facing more race bias claims in new lawsuit

A private partnership, Edward Jones is a giant in the retail brokerage industry with more than 20,000 financial advisors.

Advisor moves: LPL recruitment momentum continues with $815M Northwestern Mutual team
Advisor moves: LPL recruitment momentum continues with $815M Northwestern Mutual team

Meanwhile, Raymond James and Tritonpoint Partners separately welcomed father-son teams, including a breakaway from UBS in Missouri.

SEC chief Atkins signals caution on prediction market ETFs amid broader rethink of novel fund structures
SEC chief Atkins signals caution on prediction market ETFs amid broader rethink of novel fund structures

Paul Atkins has asked staff to solicit public comment on novel ETFs, pausing the clock on as many as 24 filings linked to the booming event contracts market.

Private capital's $1 trillion bet on the American retirement account
Private capital's $1 trillion bet on the American retirement account

From 401(k)s to retail funds, Deloitte sees private equity and credit crossing into mainstream investing on two fronts at once.

Advisor moves: Wells Fargo Advisors pulls in $9.6b in fresh talent during first half of May
Advisor moves: Wells Fargo Advisors pulls in $9.6b in fresh talent during first half of May

Big-name defections from Morgan Stanley, UBS, and Merrill Lynch headline a busy two weeks of recruiting for the wirehouse.

SPONSORED Are hedge funds the missing ingredient?

Wellington explores how multi strategy hedge funds may enhance diversification

SPONSORED Beyond wealth management: Why the future of advice is becoming more human

As technical expertise becomes increasingly commoditized, advisors who can integrate strategy, relationships, and specialized expertise into a cohesive client experience will define the next era of wealth management