SEC charges Cape Cod RIA with $3 million fraud

Agency says Kimberly Pine Kitts created fake tax documents to cover up thefts.

The Securities and Exchange Commission has charged Cape Cod RIA Kimberly Pine Kitts with defrauding seven clients and stealing more than $3 million from their accounts.

From 2011 to 2017, when a client questioned Ms. Kitts about her dwindling account, the Orleans, Mass.-based adviser forged client signatures on withdrawal requests from variable annuities, forged client signatures to wire funds from their brokerage accounts, and misled clients into withdrawing funds to make fake tax payments, the SEC charges.

It said that Ms. Kitts, who operated as Marquis Consulting, tried to conceal the 82 unauthorized withdrawals through falsified account statements and other documentation. She used the money to pay for vacations and several luxury vehicles, as well as other personal expenses, the SEC said.

The agency has asked a federal court in Boston to order Ms. Kitts to cease and desist from her practices and to pay back her clients, as well as pay an unspecified penalty.

As a result of failing to comply with a request for information about her activities after Royal Alliance discharged her in November 2017, the Financial Industry Regulatory Authority Inc. barred Ms. Kitts this past March.