SEC charges California RIA with fraud in connection with radio show
Agency says Keith Springer also tried to hide previous regulatory problems
The Securities and Exchange Commission has charged Sacramento, Calif.-based Springer Investment Management and owner Keith Springer with defrauding hundreds of retail clients, most of them in or close to retirement.
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The SEC’s complaint alleges that Mr. Springer and his registered investment advisory firm received millions of dollars in undisclosed compensation and other benefits for recommending certain investment products while claiming that they did not have any conflicts of interest. According to the complaint, many clients learned of Mr. Springer and his firm through his radio program, “Smart Money with Keith Springer.”
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While the program was essentially an infomercial since it was paid for by Mr. Springer, the SEC says he misled prospective clients into believing he was selected to host the show because of his industry expertise. The SEC’s complaint further alleges that Mr. Springer went to great lengths to hide a 2005 cease and desist order from the SEC over claims about a hedge fund he managed, as well as his disciplinary history with the New York Stock Exchange, hiring internet search suppression consultants and instructing employees not to provide the information to prospective clients.
“Our complaint alleges that Springer actively targeted vulnerable retirees by misleading them about his prominence in the industry and promising to act in their best interests,” said Erin E. Schneider, director of the SEC’s San Francisco office.
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The SEC is seeking injunctions, disgorgement of allegedly ill-gotten gains, and civil penalties.
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