SEC bars adviser charged with stealing more than $1 million from clients

Scott Newsholme faces 20 years in prison and $500,000 in fines.

The Securities and Exchange Commission has barred Scott Newsholme, an unregistered investment adviser, after he pleaded guilty last week in federal court to wire fraud, aggravated identity theft and aiding and abetting preparation of false tax returns.

Mr. Newsholme, of Farmingdale, N.J., had been barred by the Financial Industry Regulatory Authority Inc. in 2014, when he was affiliated with SII Investments through his firm, MVP Financial, of Howell, N.J., where he served as a tax preparer, accountant and unregistered investment adviser.

Last September, the SEC charged Mr. Newsholme with stealing more than $1 million from clients to support his gambling habit and other personal expenditures. To conceal his scheme, the SEC said that Mr. Newsholme made various misrepresentations to clients, including falsely reassuring them that their investments were faring well. To support his claims, he fabricated account statements, doctored stock certificates, and forged phony promissory notes purporting to be bonds and other debt instruments, the SEC said.

According to a release from the U.S. Attorney’s Office, the wire fraud charge to which Mr. Newsholme pleaded guilty carries a maximum potential penalty of 20 years in prison and a $250,000 fine. The aggravated identity theft charge to which he pleaded guilty carries a mandatory sentence of two years in prison, which must run consecutive to the sentences on the other two counts. The false tax return charge carries a maximum potential sentence of three years in prison and a $250,000 fine. Sentencing is scheduled for July 19, 2018.