The allegations read: Plaintiff securities and exchange commission ("commission"), for its complaint against defendant darryl matthew cohen ("cohen") alleges that this civil enforcement action concerns cohen's breach of his fiduciary duties when defrauding three of his clients, who are current and former nba players. Between october 2017 and april 2020, cohen misappropriated at least $1 million from those advisory clients by transferring their funds without their understanding or authorization to investments and expenditures from which he personally benefited. Cohen's misappropriation included funneling the clients' funds into his son's amateur basketball program and then using those funds to build a gym at his house, stealing one client's money to pay off another aggrieved client, and selling life insurance settlements to his clients from which he received kickbacks and funded home improvements. Investment adviser firm terminated cohen in march 2021 after discovering his misconduct, and cohen was also subsequently disciplined by the financial industry regulatory authority ("finra") after failing to cooperate with its inquiry. By engaging in the conduct alleged in this complaint, defendant cohen violated sections 206(1) and 206(2) of the investment advisers act of 1940.
