The U.S. Securities and Exchange Commission (SEC) has achieved a major legal victory with a $4.8 million judgment against investment adviser Julie Anne Darrah, following allegations that she defrauded elderly clients out of more than $2 million.
On Wednesday, U.S. District Judge Dale S. Fischer signed an order mandating Darrah to disgorge over $2.2 million, pay a civil penalty of an equal amount, and pay nearly $170,000 in prejudgment interest. Darrah consented to the judgment earlier this month, according to the docket.
Filed in October 2023, the SEC’s suit accuses Darrah and her firm, Vivid Financial Management Inc., of violating the Securities Act and the Advisers Act by misappropriating roughly $2.3 million from at least nine clients. The SEC claims Darrah used her position of trust to gain control of her clients’ assets and spent the funds on personal and business expenses between 2016 and 2023.
In one instance, the SEC asserts that Darrah defrauded a memory care facility patient by acting as the patient’s trustee. She allegedly opened bank accounts in the patient’s name and misappropriated over $1 million by selling securities held in the patient’s brokerage accounts. She transferred the proceeds to the patient’s bank accounts and took an additional $19,000 in advisory fees.