SEC Releases Statement on Jury Trial Decision Involving McDermott Investment Advisors

Posted on July 28th, 2022 at 3:09 PM
SEC Releases Statement on Jury Trial Decision Involving McDermott Investment Advisors

From the Desk of Jim Eccleston at Eccleston Law:

The Securities and Exchange Commission (SEC) has released a statement indicating that a Pennsylvania jury has ruled in its favor in a suit filed nearly three years ago against Dean McDermott and his firm over improper sales of unit investment trusts (UITs). 

The SEC initially charged McDermott Investment Advisors and its founder, Dean McDermott, in September 2019 with violating their fiduciary duties by investing several clients in UITs that featured a transaction fee while the clients were eligible for a cheaper version of the UITs. McDermott and the firm purchased nearly $5.7 million worth of higher-cost UITs for its clients, according to the SEC. The SEC additionally alleged that 90% of the $160,000 fees charged to clients were transferred to an unaffiliated broker-dealer, which was owned by McDermott. 

SEC Division of Enforcement Director Gurbir Grewal released a statement following the jury’s decision: "We are pleased with today’s jury verdict holding defendants liable for fraud against their investment advisory clients. This verdict underscores the bedrock principle that investment advisers must uphold their fiduciary duties to act in their client’s best interest, to seek the best execution of client transactions, and to fully and fairly disclose all material facts relating to conflicts of interest. When advisers fail to uphold these duties in order to line their own pockets, as the jury found today, they put their clients at risk. That’s why we will continue to pursue investment advisers who breach their fiduciary obligations." The SEC’s original complaint sought disgorgement as well as civil penalties. 

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

Tags: eccleston, eccleston law, SEC, McDermott

Return to Archive

TESTIMONIALS

Previous
Next

I learned two important things working with Eccleston Law. First, I made a friend and ally with Jim and Steph for life. Secondly, and this is a crucial life lesson - if you need counsel, then seek out the very best. Jim was referred to me by a most trusted source. I've never had to hire an attorney for anything. Now, I know the value of hiring an important partner. Meticulous, thorough and detailed in preparation is the best way to describe Jim. Brilliant too, I might add. Bottom line, I would highly highly recommend Jim and Stephany for your legal needs. One of the best life decisions I've ever made.

Howard S.

LATEST NEWS AND ARTICLES

February 4, 2026
Investor Redemptions Rise in Nontraded BDCs Amid Credit Concerns

Financial advisors and their clients have increased redemptions from nontraded business development companies (BDCs) following a series of high-profile corporate bankruptcies, according to InvestmentNews. The surge highlights growing investor concern about liquidity and credit exposure within these high-yield but often risky investment ...

February 3, 2026
FINRA Accuses Spartan Capital of Widespread Churning That Allegedly Harmed Customers

The Financial Industry Regulatory Authority (FINRA) has brought a disciplinary complaint against Spartan Capital Securities and several senior leaders of the New York City–based broker-dealer, alleging that the firm facilitated excessive trading that generated millions of dollars in revenue while causing substantial losses to customers.

February 2, 2026
California Investors Allege Unsuitable DST Recommendations in FINRA Arbitration

Two investors from the San Francisco Bay Area have filed a FINRA arbitration claim against brokerage firm Realized Financial and its financial advisors.