SEC Files Fraud Charges Against Financial Advisor for Exploiting Elderly Clients

Posted on June 7th, 2023 at 1:17 PM
SEC Files Fraud Charges Against Financial Advisor for Exploiting Elderly Clients

From the desk of Jim Eccleston at Eccleston Law 

The Securities and Exchange Commission (SEC) has charged Douglas McKelvey, a former Morgan Stanley financial advisor, with fraud for misappropriating more than $1.7 million from two elderly customers who were his close relatives.

According to the SEC complaint, from June 2013 to February 2022, McKelvey initiated over 300 fraudulent and unauthorized disbursements of funds from the two customers' accounts to make payments on credit cards McKelvey and his wife used to pay their personal expenses. The complaint also alleges that McKelvey sold securities from the customers' accounts to generate some funds he misappropriated and took steps to conceal his misconduct.

The SEC's complaint accuses McKelvey of violating the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. The Commission is seeking several forms of legal action, including permanent injunctive relief, the disgorgement of allegedly ill-gotten gains along with prejudgment interest, and a civil penalty. In addition to the civil penalties, the U.S. Attorney's Office for the Eastern District of Texas has announced criminal charges against McKelvey, which has pled guilty.


Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.


Tags: eccleston, eccleston law

Return to Archive



This was the best of all possible outcomes and I cannot thank you and the team enough.

Michael S.


May 17, 2024
Fidelity Advisor Files Lawsuit Alleging Wrongful Termination Over Whistleblowing

A former Fidelity Investments advisor, Michael Maeker, has initiated legal action against his former firm, alleging wrongful termination in response to his reporting of anti-investor sales tactics.

May 16, 2024
CFTC Investigates Banks for Potential Whistleblower Suppression

The Commodity Futures Trading Commission (CFTC) has initiated inquiries into several banks, including JPMorgan Chase, Bank of America, and Citigroup, regarding potentially hindering whistleblowers from disclosing information, as reported by Bloomberg News.


May 15, 2024
NFA Issues Order Against Investments LLC

The National Futures Association's (NFA) Business Conduct Committee (BCC) has taken action against Investments LLC, a former NFA Member commodity pool operator and forex firm, for violating multiple NFA compliance rules.