SEC v. Scott Allen Fries (2020)
Judgment entered
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In September 2020 the SEC charged former Ohio broker Scott Allen Fries with defrauding investors. On 28 February 2022 the Southern District of Ohio entered a default judgment enjoining him from further antifraud violations and ordering US$428,334.53 in disgorgement, US$110,548.02 in interest and a US$208,500 penalty.
The record
| Agency | SEC |
|---|---|
| Release number | LR-24902 |
| Date filed | 2020-09-17 |
| Date resolved | 2022-02-28 |
| Status | judgment |
| Criminal parallel | No |
| Defendants | Scott Allen Fries |
| Cited as charged or alleged | Advisers Act s.206 ; Exchange Act s.10(b) and Rule 10b-5 ; Securities Act s.17(a) |
| Techniques |
What was ordered
- Civil penalty
- $209k
- Disgorgement
- $428k
- Prejudgment interest
- $111k
- Total relief
- $747k
- Alleged gain
- —
What is alleged to have happened
The SEC announced the complaint on September 17, 2020 (LR-24902) in the Southern District of Ohio, covering January 2016 to March 2019. He is charged under Section 17(a), Section 10(b), Rule 10b-5 and Advisers Act Sections 206(1) and 206(2); the SEC asked for an injunction, disgorgement and a penalty, and the outcome is set out below.
The Ponzi tag is removed because the release describes misappropriation, with one Ponzi-like repayment mentioned as a cover-up detail.
Outcome. SEC release LR-25347 reports that on 28 February 2022 the court entered a final judgment against Fries on the basis of default. It enjoins future violations of the antifraud provisions of the Securities Act, the Exchange Act and the Advisers Act, and orders disgorgement of US$428,334.53, prejudgment interest of US$110,548.02 and a civil penalty of US$208,500. The release repeats the amended complaint's allegation that he raised at least US$458,000 from ten investors and spent it on himself.
Because the judgment was by default, it reflects the SEC's unopposed showing rather than a contested trial. The source does not show how much has been collected.
Timeline
- 2020-09-17 Litigation release published
- 2022-02-28 Default final judgment entered (SEC LR-25347, published 17 March 2022)
Primary documents
Everything on this page derives from the documents below. Where our summary and the primary document disagree, the primary document is right.