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Matthias Knab, Opalesque: The U.S. Securities and Exchange Commission (SEC) has taken decisive action against Chauncey Forbush Lufkin, III, the President and Chief Compliance Officer of Lufkin Advisors, LLC, barring him from association with various financial industry entities. This action comes in the wake of serious allegations of fraudulent conduct and regulatory violations.
On June 26, 2024, the SEC instituted administrative proceedings against Lufkin under the Investment Advisers Act of 1940. The charges stem from a civil action filed in the U.S. District Court for the Southern District of Florida, where Lufkin consented to a final judgment permanently enjoining him from future violations of multiple sections of the Advisers Act.
The SEC's complaint outlines a troubling pattern of misconduct by Lufkin and his firm. Key allegations include:
1. Loss of Control: For at least one year, Lufkin Advisors lost control of crypto assets entrusted to them by clients. Shockingly, they failed to disclose this critical information to their advisory clients.
2. Undisclosed Conflicts of Interest: The firm made multiple investments with Lufkin's spouse's employer without proper disclosure to private fund investors, raising serious conflict of interest concerns.
3. Accounting Irregularities: Lufkin Advisors failed to properly account for withdrawals from private funds, potentially misleading investors about the true state of their investments.
4. Ina...................... To view our full article Click here
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