Securities America Inc. is facing a lawsuit over an alleged fraudulent scheme perpetuated by two of its financial advisers.
The suit was filed in February in the U.S. District Court for the Southern District of New York. The Jamieson family alleged they lost more than $18 million to a long-running scheme by advisers Hector May and Vania Bell to steal money and provide "investment advice designed to make it easier for [May] to steal more."
The family said the scheme began in 2001 and that the only reason the two financial advisers were able to steal the money was because Securities America did not perform its supervisory duties. They also alleged that the company ignored red flags raised by the compliance department on May and that if it had not ignored these warning signs, Securities America would have exposed the scheme in 2003. At that time, the plaintiffs alleged $750,000 had already been stolen from them.
Over the course of the alleged scheme, the plaintiffs claimed Securities America received over $1 million in fees from May's services to clients, including more than $500,000 from the Jamiesons.
Securities America did not respond to a request for comment, Investment News reported March 21. The company is also facing a Financial Industry Regulatory Authority complaint over its alleged aiding and abetting of May, who is accused of running a Ponzi scheme for years.
May in December 2018 pleaded guilty to charges of running a Ponzi scheme and is facing up to 25 years in prison. He was fired by Securities America in 2018 after accusations of stealing from clients, Investment News reported.