SEC v. James S. Tagliaferri (ponzi schemes, 2013)

Judgment entered

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In February 2013 the SEC instituted administrative proceedings against investment adviser James S. Tagliaferri, alleging undisclosed conflicts and a Ponzi-like scheme, on the day a parallel criminal indictment was unsealed. After his criminal conviction the proceeding became a follow-on case, and the Commission's February 15, 2017 opinion upheld permanent industry and penny-stock bars.

The record

What was ordered

Civil penalty

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Disgorgement

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Prejudgment interest

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Total relief

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Alleged gain

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A dash means the release did not state a figure we could extract, not that the figure is zero. Penalty and disgorgement are stored separately so aggregates across the library do not double-count the same dollars.

What is alleged to have happened

The order instituting proceedings alleged, and did not find, that from at least 2007 to 2010 Tagliaferri, through his firm TAG Virgin Islands, put client money into promissory notes issued by companies tied to one individual without disclosing the kickbacks TAG received, and that when the notes fell due he raised the repayments by buying thinly traded stock for other clients from that individual.

Outcome. The proceeding was stayed at the request of the U.S. Attorney while a parallel criminal case, United States v. Tagliaferri (S.D.N.Y.), went forward. The administrative law judge's March 23, 2016 initial decision records that he was convicted of investment adviser fraud, securities fraud, wire fraud and related crimes, sentenced to 72 months in prison, and ordered to forfeit $2.5 million and pay nearly $21 million in restitution. The proceeding had been converted into a follow-on case based on the conviction, and the judge granted summary disposition, imposing permanent associational, penny-stock and investment-company bars. Tagliaferri appealed, and in an opinion dated February 15, 2017 the Commission found the associational and penny-stock bars in the public interest. The Commission's earlier decision to drop civil penalty and disgorgement from the case because of the criminal sentence means the administrative record shows no SEC penalty or disgorgement. We did not check whether any later court review followed the Commission opinion.

This library tags the matter as ponzi schemes because the order alleges a Ponzi-like scheme in which some clients' assets were used to repay other clients. The tagging is ours, not the regulator's: agencies charge statutory provisions, not technique names.

What technique is this, and how does it work?

This action is tagged with one technique in our taxonomy. The tagging is ours: regulators charge statutory provisions, not technique names, so the mapping is an editorial judgement described in our editorial policy.

• Ponzi schemes — see how it works, what statute it engages, and every other action tagged the same way.

Timeline

1. 2013-02-21 Administrative proceeding instituted (administrative)
2. 2016-03-23 Initial decision: permanent industry and penny-stock bars
3. 2017-02-15 Commission opinion upholds associational and penny-stock bars

Primary documents

Everything on this page derives from the documents below. Where our summary and the primary document disagree, the primary document is right.

• SEC order
• ALJ initial decision (ID-985)
• Commission opinion, Feb. 15, 2017

The linked release is a work of the United States government and is not subject to copyright. Our summary and narrative above are our own writing.

Related actions

Other actions in the library sharing at least one technique tag with this one.

Record added September 10, 2026. submit a correction.