trending Market Intelligence /marketintelligence/en/news-insights/trending/RXpKbJaVUxCsik9L1G29wA2 content esgSubNav
In This List

SEC charges Cambridge Capital Group Advisors with defrauding investors

Podcast

Street Talk Episode 87

Blog

A New Dawn for European Bank M&A Top 5 Trends

Blog

Insight Weekly: US banks' loan growth; record share buybacks; utility M&A outlook

Blog

Banking Essentials Newsletter 2021: December Edition


SEC charges Cambridge Capital Group Advisors with defrauding investors

The SEC charged Tallahassee, Fla.-based investment adviser Cambridge Capital Group Advisors LLC and its two former principals, Phillip Howard and Don Reinhard, with defrauding 20 investors in two proprietary hedge funds operating out of Howard's law offices.

Most of the investors were retired National Football League players who had joined a class-action lawsuit against the league claiming they suffered brain injuries as a result of concussions.

Howard is a Florida attorney who represented the retired NFL players in the class-action lawsuit against the league. Reinhard is a former registered investment adviser who had served jail time for bankruptcy and tax fraud and had been barred by the SEC from working for any investment adviser firm.

Howard and Reinhard allegedly raised $4 million from the retired NFL players, about half of whom rolled over their NFL 401(k) accounts to the hedge funds. The SEC's complaint claimed the defendants advertised that the funds would invest in various instruments, but unbeknownst to investors, invested almost exclusively in settlement advance loans to more than 70 of Howard's NFL class-action clients.

Additionally, Howard allegedly defrauded investors by borrowing $612,000 in undisclosed personal mortgage loans from the funds, which he never repaid. The SEC also alleges that Howard and Reinhard used investor funds to pay themselves fabricated broker fees on settlement advance loans to Howard's legal clients.

The SEC complaint, which was filed in federal district court in the Northern District of Florida, charges Howard, Reinhard and Cambridge Capital Group Advisors with violating the anti-fraud provisions of the federal securities laws, and seeks permanent injunctions, disgorgement of allegedly ill-gotten gains, prejudgment interest and financial penalties.

The SEC's investigation was conducted by David Staubitz and Mark Dee, under the supervision of Chedly Dumornay and Glenn Gordon of the SEC's Miami Regional Office. The litigation will be led by Amie Berlin, under the supervision of Andrew Schiff.