Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Friday, April 10, 2009

SEC Obtains TRO Against Ohio Adviser Alleging Fraud on Elderly Clients

The SEC filed a civil action on April 8, 2009, against Crossroads Financial Planning, Inc., and Julie M. Jarvis, of Columbus, Ohio, in connection with an alleged scheme by Jarvis to misappropriate funds from two elderly clients. Crossroads is an investment adviser registered with the Commission, and Jarvis is its president, chief operating officer and principal owner. The Commission's complaint, filed in the United States District Court for the Southern District of Ohio, alleges that Jarvis, the owner of Crossroads, misappropriated at least $2.3 million between June 2000 and March 2009.  According to the Commission's complaint, in or about May 2000, Jarvis first caused the unauthorized transfer of funds from a client's account at a brokerage firm. Over the course of the next nine years, through various means including forged and falsely notarized funds transfers instructions, Jarvis misappropriated funds from the investment accounts of the two elderly clients and used those funds for her personal expenses and benefit. In some instances, Jarvis had to liquidate securities to effect the fraudulent transfers.

On April 9, 2009, the court granted the Commission's motion for a Temporary Restraining Order ("TRO") and set the Preliminary Injunction hearing for April 22, 2009. In addition to enjoining the defendants from violating provisions of the Federal Securities laws, as charged by the Commission in its complaint, the TRO imposes a freeze on Jarvis's and Crossroads' assets. The Judge also ordered Jarvis to submit a financial accounting, and he granted the Commission's request for expedited discovery and other emergency relief.

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