The allegations read: Plaintiff securities and exchange commission ("the commission") alleges that between at least 2014 and 2022, jeffrey cutter ("cutter") engaged in a pattern of deception designed to steer his investment advisory clients to certain insurance products over other investment options, while concealing his financial motive to do so in breach of his fiduciary duties as an investment adviser. Beginning in october 2017, cutter perpetrated this scheme through an investment adviser firm he formed called cutter financial group ("cfg"). Time after time, cutter switched clients out of annuity contracts he had previously sold them into new annuity contracts without adequately disclosing his financial incentive to recommend these switches, including the substantial, up-front commissions he received from the insurance company and other third parties. To perpetrate his scheme, cutter made false statements to the insurance companies to effectuate the switches and generate a new round of commissions for himself. In doing so, cutter and cfg breached their fiduciary duties to never place their own interest ahead of their clients' interests, to disclose all material conflicts of interest, and to obtain clients' informed consent to those conflicts before proceeding. Cutter and cfg also failed to disclose the free marketing services and payments of more than $1.1 million that cutter received from marketing firms in exchange for peddling annuities to his clients. In doing so, they abrogated their fiduciary duty of loyalty to make full and frank disclosure of all conflicts of interest to their advisory clients and to obtain their clients' informed consent to these conflicts of interest. Through the activities alleged in this complaint, cutter violated sections 206(1) and 206(2) of the advisers act, and aided and abetted cfg's violations of section 206(4) of the advisers act and rule 206(4)-7 thereunder.
