SEC v. Cobb

Eric Cobb allegedly engaged in a long-running fraudulent trade allocation scheme, commonly referred to as “cherry-picking.” According to the SEC’s complaint, from at least June 2019 to mid-April 2022, Cobb disproportionately allocated profitable trades to his personal and wife’s accounts, and unprofitable trades to certain client accounts. Cobb allegedly executed the scheme by buying securities in an omnibus account and then often waiting a day or longer to allocate the trades, which allowed him to see whether the securities had increased in price. The SEC’s complaint also alleged that Cobb routinely placed clients in highly volatile and risky investments that were inconsistent with their investment profiles.

Summary generated from official Securities and Exchange Commission press release