The SEC charged Kerry Lee Hoffman, former LPL advisor from Chicago, with securities fraud. If you invested with Hoffman call 1-866-817-0201 to discuss your rights and potential for recovery. The fraud concerned sales of GT Media in which he partnered with childhood friend and convicted thief Thomas Conwell.
Between July 2015 and July 2018, Conwell and Hoffman raised over $3.3 million from approximately 46 investors through the sale of unregistered GT Media, Inc. securities.
According to the SEC Complaint, Conwell, who was previously enjoined by the SEC and criminally convicted for stealing money from investors, made numerous false representations to investors, including that two Fortune 500 companies were seeking to acquire GT Media and that GT Media would soon conduct an initial public offering.
The prior conviction of Conwell was from January 2006, when Conwell pleaded guilty to charges of wire fraud, bank fraud and obstructing an SEC investigation and he was sentenced to 48 months in prison. He was barred from the securities industry by the SEC in 2000.
The complaint filed by the SEC also alleges that Conwell, in the present matter concerning GT Media, misappropriated $161,500 from investors, which he used to pay his personal expenses. According to the complaint, Hoffman, a registered representative and investment advisory representative at LPL, solicited certain of his advisory clients to invest in GT Media securities without disclosing his financial conflicts of interest, including his compensation from GT Media and his short-term loans to GT Media that were repaid using investor funds.
The failure to disclose such conflicts is fraud, but a greater fraud is the failure to disclose the lack of due diligence investigation, along with other material financial information that Hoffman would have possessed.
The SEC action is currently pending in federal district court in Chicago.
Hoffman’s record indicates that he was a broker with LPL until September 2018. At that time he was allowed to voluntarily resign after allegations were made against him concerning a failure to disclose certain outside business activity. He had been a broker with LPL since February 2010.
Hoffman had previously been fired by UBS when a co-worker accused him of making securities trades without the authorization of the investor. This fraud was public record when he was hired by LPL.