Broker fined, barred by SEC for cherry-picking
Cease-and-desist order alleges Roger Denha allocated profitable trades to his personal account at the expense of clients.
The Securities and Exchange Commission is barring and fining Roger Denha, an investment adviser with BKS Advisors, for allegedly engaging in “cherry-picking.”
According to an SEC cease-and-desist order, Mr. Denha bought securities in an omnibus account and waited to allocate them until after they increased or decreased in price. Mr. Denha then disproportionately allocated profitable trades to his personal and family accounts, while allocating unprofitable trades to his advisory clients.
He conducted this scheme from January 2012 to November 2017 to obtain $412,230 of realized and unrealized gains, the SEC filing alleges.
(More: SEC bars former adviser, orders him to pay $1.58 million)
By knowingly allocating trades to favored accounts at the expense of others, the SEC said Mr. Denha violated a rule prohibiting investment advisers from employing any device, scheme or artifice to defraud clients.
In addition to barring Mr. Denha, the SEC ordered a disgorgement of the gains plus $35,388 of interest. He was also fined $169,000.
Mr. Denha managed 197 clients and $202 million in assets. He has no other disciplinary history.
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