INVESTORS: North Carolina-based executives Gregory Lindberg and Christopher Herwig, as well as their Malta-based registered investment adviser, Standard Advisory Services Limited, were charged by the SEC with defrauding clients out of more than $75 million.
North Carolina-based executives Gregory Lindberg and Christopher Herwig, as well as their Malta-based registered investment adviser, Standard Advisory Services Limited, were charged by the SEC with defrauding clients out of more than $75 million through undisclosed transactions that benefited themselves and their companies.
The SEC’s complaint alleges that from July 2017 through 2018, Lindberg and Herwig, through Standard Advisory, breached their fiduciary duties to their advisory clients by fraudulently causing them to engage in undisclosed related-party transactions that were not in the best interest of their clients. The complaint further alleges that the defendants misappropriated more than $57 million in client funds and that Standard Advisory collected more than $21.4 million in advisory fees generated in connection with these schemes. In an attempt to conceal the fraud, Lindberg allegedly orchestrated the schemes through complex investment structures and a web of affiliate companies and allegedly used the proceeds to pay themselves or to divert the funds to Lindberg’s other businesses.
The SEC charged Lindberg,Herwig, and Standard Advisory with violating Sections 206(1) and 206(2) of the Investment Advisers Act of 1940, charges Lindberg and Herwig with aiding and abetting Standard Advisory’s violations of Sections 206(1) and 206(2) of the Advisers Act of 1940, and seeks disgorgement plus prejudgment interest, penalties, and permanent injunctions.
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