On May 4, 2018, the Securities and Exchange Commission (SEC) announced that Paul W. Smith was sentenced to 63 months imprisonment followed by one year of supervised release and ordered to pay $886,214 in restitution. Smith was sentenced in criminal charges filed against him by the U.S. Attorney’s Office for the Eastern District of Pennsylvania.
The SEC filed a parallel civil action in December 2017 accusing Smith of using the Haverford Group to raise approximately $2.35 million from about 30 individuals in what amounted to a Ponzi scheme. Smith promoted the Haverford Group as an investment club that would invest pooled funds in publicly traded stocks, said prosecutors.
However, according to the SEC, Smith made few actual investments and used much of the funds for his personal expenses. He also reportedly used some of the funds in classic Ponzi scheme fashion by making payments to existing investors from new money raised to conceal his scheme.
The Financial Industry Regulatory Authority, Inc. (FINRA), the regulator of brokerages and brokers, announced on June 6, 2017 that it permanently barred Smith from associating with FINRA member firms. Smith allegedly failed to cooperate in FINRA’s investigation of his possible private securities transaction. A “private securities transaction” occurs outside the scope of a broker’s normal employment.
According to FINRA records, Smith’s former customers have filed twelve claims against him and his firms. From April 2017 through September 2017, seven claims were filed that are still pending and one was filed that is now settled. The settled claim alleged losses of $105,000 and settled for $100,000. The claims alleged losses from Haverford Group, among other misconduct.
Paul W. Smith entered the securities industry in 1982. He was registered as a General Securities Representative with Bolton Global Capital from May 2007 through February 2017.
If you suffered losses while investing with Paul Smith, contact Marquardt Law Office LLC to speak with a securities attorney and receive a free case evaluation. You may be able to recover your losses.
Marquardt Law Office LLC is a securities law firm located in Chicago, IL that represents clients nationwide who have suffered losses due to misconduct such as fraud and negligence.
