SEC Announces Cherry-Picking Charges Against Mark Welhouse

Posted on July 28th, 2015 at 11:55 AM
SEC Announces Cherry-Picking Charges Against Mark Welhouse

From the Desk of Jim Eccleston at Eccleston Law LLC:

The SEC announced charges against Mark P. Welhouse. Welhouse is accused of “cherry-picking,” allocating appreciated in value options trades to personal accounts, while allocating depreciated in value trades to clients.

This case is the first enforcement action on behalf of the SEC Enforcement Division in its initiative against “cherry-picking.” In the data-driven initiative, the SEC analyzes trade allocation data and identifies individuals disproportionately allocating trades.

Welhouse allegedly purchased options in a master account for Welhouse & Associates Inc. and delayed allocation to clients until later in the day allowing time to see whether the trades appreciated or depreciated in value.

According to the SEC charges, through “cherry-picking,” Welhouse gained $442,319 through options trades in an S&P 500 exchange-trade fund. While Welhouse had an average positive return of 6.28%, his clients were not as lucky with the average loss of 5.05%.

The attorneys of Eccleston Law LLC represent investors and advisers nationwide in securities and employment matters. Our attorneys draw on a combined experience of nearly 65 years in delivering the highest quality legal services.

Related Attorneys: James J. Eccleston

Tags: Eccleston Law LLC, James Eccleston, eccleston, Eccleston Law, SEC, Securities Exchange Commission,

Return to Archive

TESTIMONIALS

Previous
Next

I just received this letter from the CFP Board. Thank you, Thank you, THANK YOU!

David Y

LATEST NEWS AND ARTICLES

August 12, 2022
SEC Charges J.P. Morgan, UBS, and TradeStation for Deficiencies Pertaining to the Prevention of Customer Identify Theft

The Securities and Exchange Commission (SEC) has charged J.P. Morgan Securities, UBS Financial Services, and TradeStation Securities over deficiencies in their programs designed to prevent client identify theft, which violates the SEC’s Identity Theft Red Flags Rule, or Regulation S-ID.

August 11, 2022
FINRA Suspends Former Schwab Advisor for Failing to Disclose Felony Charges

The Financial Industry Regulatory Authority (FINRA) has suspended a former Charles Schwab advisor who allegedly failed to disclose multiple felony charges.

August 10, 2022
UBS Wealth Group’s Legal Costs Skyrocket in Q2

UBS Wealth’s litigation expenses have substantially spiked in the second quarter as the firm has faced a host of investor complaints and regulatory probes into UBS’ volatile Yield Enhancement Strategy (YES).