SEC permanently bars RIA Michael Shillin over fraud

Obtains partial judgment against Wisconsin adviser; court will determine penalties later.

A federal court in Wisconsin has entered a partial judgment against Michael F. Shillin, a former registered investment adviser, whom the Securities and Exchange Commission had previously charged with defrauding at least 100 advisory clients.

The judgment bars Shillin from acting as an officer or director of a public company and orders him to pay disgorgement, prejudgment interest, and a civil penalty, the amount of which the courts will determine later. The SEC also barred Shillin from the securities industry permanently.

According to the SEC’s complaint, which was filed on Sept. 23, 2021, Shillin, while acting as an investment adviser, fabricated documents and made misrepresentations to clients, many of whom were elderly. The SEC alleged that Shillin misrepresented that certain clients had successfully subscribed for IPO or pre-IPO shares in high-profile companies when they had not, and lied to clients about the true value of their investment portfolios.

The complaint alleged that Shillin encouraged several advisory clients to roll over their existing life insurance policies into new policies, which caused certain clients to sell securities in order to pay premiums for policies that were non-existent or had far fewer benefits than Shillin claimed.

Finally, the complaint alleged that Shillin received hundreds of thousands of dollars in ill-gotten gains as a result of his fraudulent conduct.