SEC v. Lufkin Advisors, LLC and Chauncey Forbush Lufkin, III

Lufkin Advisors, LLC and Chauncey Forbush Lufkin, III allegedly engaged in an ongoing fraud on the private funds they manage and the investors in those funds, as well as multiple other violations. According to the SEC, defendants for years engaged in a fraudulent course of conduct that included a loss of control of crypto assets entrusted to them for at least one year without disclosure of that fact to advisory clients, multiple investments with Mr. Lufkin’s spouse’s company without proper disclosure to private fund investors, failure to properly account for withdrawals from the private funds, failure to monitor the value of the investments made by the private funds, and a general derogation of their duty to manage the assets entrusted to them. The complaint also alleged that defendants did not adhere to many of the statutes and rules applicable to registered investment advisers, including rules concerning the custody of assets, the accuracy of reports filed with the SEC, the maintenance of required adviser records, and the production of those records to the SEC Examinations staff.

Summary generated from official Securities and Exchange Commission press release