Next Financial, Adviser Jeremy McGilvrey Focus Of Fraud Lawsuit
Financial exploitation of the elderly – including misrepresentation, unsuitable investments, stockbroker negligence and securities fraud – is growing at an alarming rate. Case in point: An elderly Texas couple was caught in a multimillion-dollar fraud scheme allegedly orchestrated by Jeremy McGilvrey, a former stockbroker with Next Financial and the owner of the collapsed investment firm Hill Country Wealth. James Crouch, who serves as guardian for his father and stepmother, Thomas and Dottie Crouch, is now suing both McGilvrey and Next Financial.
According to the complaint, McGilvrey induced the couple to invest in risky financial products and even lend him money, which he in turn reportedly used to open brokerage accounts in his own name. The lawsuit seeks to recover $2 million in lost assets, as well as punitive damages.
McGilvrey's “investment strategy” for the elderly couple included charging them outrageous fees for handling their investment portfolio; converting their money for his personal use; and placing assets into investments designed to earn the most money for the defendant and without regard to the risks to the plaintiffs, the lawsuit said.
Prior to being added to the Crouch lawsuit in August 2009, Houston-based Next Financial Group faced another legal problem in July when the Financial Industry Regulatory Authority (FINRA) fined the company $1 million for supervisory violations. At the time, the charges in question were tied to the failure of Next Financial to properly supervise its approximately 130 Office of Supervisory Jurisdiction (OSJ) branch managers, who typically supervised transactions and sales activity for individual brokers or branches within a particular region.
In May 2009, McGilvrey was fired from Next Financial for “borrowing money from a client,” according to records on file with FINRA.
As reported Sept. 3 by the San Antonio News, after fleecing the Crouches out of hundreds of thousands of dollars, McGilvrey allegedly used their money to pay Las Vegas casino debts and huge personal credit card bills and to buy a Mercedes Benz.
McGilvrey, 32, initially vanished following news that an indictment from Bexar County District Attorney Susan Reed was forthcoming. However, the disgraced broker ultimately was arrested and now remains in Bexar County Jail in lieu of posting $500,000 bail.
If you've sustained losses with financial adviser Jeremy McGilvrey or other investment adviser, contact us. We can advise you on your legal options.