Former San Antonio broker Jeremy McGilvrey allegedly used the money he fleeced from investors to take care of personal business, which apparently included a bevy of Las Vegas casino debts, credit card bills and the purchase of a new Mercedes Benz.

McGilvrey’s fancy living came to an end in August 2009, following an investigation by the Texas State Securities Board and the Texas District Attorney’s Office. According to the indictment, McGilvrey promoted himself as a “prudent, conservative financial advisor” who employed “sound principles” to protect client funds and investments. Instead, McGilvrey later admitted that he diverted investors’ funds for his personal use.

In one instance, McGilvrey solicited a $100,000 check from 85-year-old Anthony Knopp. According to authorities, it was Knopp’s understanding that McGilvrey would invest the money on Knopp’s behalf. As it turns out, McGilvrey used the investor’s cash to pay off other investors, as well as to pad his own pockets.

Thomas and Dorothy Crouch were two of the investors McGilvrey tried to pay off. The couple had previously filed a lawsuit against McGilvrey, charging they lost about $1.5 million after McGilvrey steered them into investments that included stock purchases in McGilvrey’s now-defunct investment firm - Hill Country Wealth - and supplying him with a substantial loan.

In December, Judge Maria Teresa Herr sentenced McGilvrey to 20 years in the Texas Department of Corrections. McGilvrey also was ordered to pay in excess of $1.9 million in restitution to the client he scammed. The restitution amounts could increase if other defrauded investors are identified.

If you had investment dealings with Jeremy McGilvrey, we encourage you to contact our securities fraud team. We can evaluate your situation to determine if you have a viable claim.

Jeremy McGilvrey, a former broker with Next Financial Group and LPL Financial and one-time CEO of the now-defunct Hill Country Wealth investment firm, had a reputation for extravagance: A black Bentley convertible, exotic vacations and celebrity parties. Today, McGilvrey is trading his fancy suits for a different kind of fashion wear: a prison uniform.

On Dec. 1, 2009, Bexar County state District Judge Maria Teresa sentenced the former high-flying investment adviser to 20 years in prison for swindling clients out of millions of dollars. McGilvrey also was ordered to pay a $10,000 fine and nearly $2 million in restitution to his victims. The amount could increase if authorities identify additional clients taken in by the Texas broker.

In October, McGilvrey, 32, pleaded guilty to felony theft and misapplication of fiduciary property of clients, most of whom were elderly. Two victims, Thomas and Dorothy Crouch, were taken for an estimated $1.6 million. Their son, Houston attorney James Crouch, has since filed a lawsuit against McGilvrey.

The 94-year-old Crouch, who once served as deputy surgeon general of the U.S. Air Force, died Nov. 30, 2009. He suffered from Alzheimer’s.

McGilvrey was fired from Next Financial in May 2009 for “borrowing money from a client,” according to records with the Financial Industry Regulatory Authority (FINRA).

Before joining Next Financial, McGilvrey was affiliated with LPL Financial of Boston. FINRA records state that he was “permitted to resign” from LPL last year after failing to properly supervise a registered representative and for not reporting a business transaction.

Next Financial also is one of a number of independent broker/dealers with advisers connected to sales of private securities of an oil and gas partnership, Provident Asset Management LLC. In July, the Securities and Exchange Commission (SEC) charged Provident of committing a $485 million fraud.

Our lawyers are actively pursuing Jeremy McGilvrey and Next Financial Group. Please tell us about your investment losses by leaving a message in the comment box, or the Contact Us page. We will counsel you on your options.

Next Financial Group is finding the year of 2009 to be an ongoing hotbed of controversy, with the independent broker/dealer mired in investor complaints and regulatory problems. In July, the Houston-based firm was fined $1 million by the Financial Industry Regulatory Authority (FINRA) for supervisory failures that led to churning of customers’ accounts and excessive commissions. In August, a former Next Financial broker, Jeremy McGilvrey, became the target of an investigation and eventual lawsuit for allegedly stealing $1.5 million from two elderly clients, one of whom suffers from severe Alzheimer’s and dementia. The complaint was amended in September to include Next Financial, which the claimant says failed to supervise McGilvrey during the time that the crimes reportedly were committed.

Next Financial also was one of a number of independent broker-dealers with advisers selling private securities of an oil and gas partnership - Provident Asset Management LLC of Dallas - that the Securities and Exchange Commission (SEC) brought charges against last month for allegedly committing a $485 million Ponzi scheme.

Allegations of supervisory failures in connection to rogue brokers are not exactly new to Next Financial. According to FINRA records, similar troubles date back several years. In 2008, a Next Financial broker who had been ousted from the securities industry cost Next Financial $165,000 to settle claims involving clients who got burned by the broker. The broker in question was Gregory Horton, who joined Next Financial in 2004.

FINRA later imposed fines on Next Financial, citing the firm’s lack of reasonable policies and written procedures resulted in its failure to detect churning of customer accounts by Horton and another Next Financial broker, Timothy Shively, as well as excessive markups and markdowns on corporate bond trades by another two brokers. As a result, customers of Next Financial, including elderly and retired individuals, lost about $768,000.

In separate actions, FINRA barred Horton and Shively from the securities industry in January 2008 and October 2008, respectively.

FINRA further found that Next Financial’s systems and procedures governing variable annuity exchanges were not reasonable and failed to provide adequate guidance about the criteria that should be used when recommending variable annuity exchanges to clients.

To learn whether you can recover losses through a claim against Next Financial Group, please fill out the Contact Us form or leave a comment below. We want to hear your story and consult with you about your options.