SEC v. Jorge Gomez and Roberto Aleph Espinosa, Case No. 1:12-CV-21962 (S.D. Fl.). On May 29, 2012, the SEC charged Jorge Gomez, an investment adviser, with perpetrating a fraudulent scheme to misappropriate millions from an investment advisory client.  The SEC also agreed to settle related charges against Roberto Aleph Espinosa who, with Gomez, provided investment advisory and brokerage services to their client.  In 2007, Gomez convinced a client to invest $10.8 million by presenting false claims regarding his affiliation with two large financial institutions.  In addition, Gomez misappropriated approximately $4.3 million from the client and concealed this misappropriation by providing fake account statements which overstated the client’s account misstated the securities transactions and holdings.  He also created a fake customer service hotline to field calls from the client.  The SEC alleges that Espinoza and Gomez invested about $3 million of the client’s funds in a hedge fund, ACG Global Fund, Ltd., which was started by Espinosa and his now defunct Aleph Consulting Group LLC.  Unbeknownst to the client, Aleph received fees in connection with the purchase of certain securities.  Additionally, Espinosa forwarded withdrawal requests signed by Gomez to the foreign financial services firm holding the client’s brokerage account. The funds were redirected into Gomez-controlled accounts, without informing the client.

The complaint charges Gomez with violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5(a), (b), and (c) thereunder; and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940.  Espinosa is charged with violations of Section 15(a) of the Exchange Act and Sections 206(1), (2), and (4) of the Advisers Act and Rule 206(4)-8 thereunder.  The SEC is seeking permanent injunctions against Gomez for violating or aiding and abetting violations of the securities laws, disgorgement of ill-gotten gains with pre-judgment interest, and civil monetary penalties.  Without admitting or denying the allegations, Espinosa has agreed to a settlement by consenting to entry of a permanent injunction against future violations of Exchange Act Section 15(a) and Advisers Act Sections 206(1), (2), and (4) and Rule 206(4)-8, disgorgement of $885,000 plus prejudgment interest, and a civil monetary penalty of $130,000.