Securities and Exchange Commission v. John A. Grant, Sage Advisory Group, LLC and Benjamin Lee Grant, Civil Action No. 1:11-CV-11538 (GAO) (D. Mass.)
SEC Obtains Final Judgment and Issues Administrative Orders Against John A. (“Jack”) Grant
The Securities and Exchange Commission recently announced that on May 17, 2013, the Honorable George A. O’Toole Jr. of the United States District Court for the District of Massachusetts entered a final judgment against defendant John A. (“Jack”) Grant, a lawyer and former stockbroker living in Yarmouth Port, MA. Among other relief, the final judgment imposes a permanent injunction against future violations of certain antifraud provisions of the federal securities laws and orders Jack Grant to pay a total of $201,392.27.
The Commission also announced the issuance of administrative orders barring Jack Grant from the securities industry and from practicing before the Commission.
In its federal court Complaint, the Commission alleged that Jack Grant violated a Commission bar from association with investment advisers by associating with his son Lee Grant’s investment advisory firm, Sage Advisory Group LLC (“Sage”), and by acting as an investment adviser himself. In 1988, the Commission filed a previous enforcement action against Jack Grant alleging that he sold $5,500,000 of unregistered securities and misappropriated investors’ funds. At that time, Jack Grant agreed to a settlement that resulted in a July 1988 order barring him from association with brokers, dealers, and investment advisers.
Jack Grant did not remove himself from the securities business, however, and instead continued to provide investment advice to individuals and small businesses. The Commission’s Complaint alleged that he retooled his service as the Law Offices of Jack Grant and used his son, Lee Grant, to help implement his investment advice. The Complaint further alleged that Jack Grant, Lee Grant, and Sage failed to inform their advisory clients that Jack Grant is barred from associating with investment advisers.
The final judgment permanently enjoins Jack Grant from violating Sections 206(1) and 206(2) of the Investment Advisers Act of 1940. In addition, the final judgment orders him to comply with the Commission’s 1988 bar order and orders him to undertake notification to his clients of the final judgment. Without admitting or denying the Commission’s allegations, Jack Grant consented to the entry of the final judgment.
Jack Grant also consented to the Commission’s entry in follow-on administrative proceedings of a permanent bar, pursuant to Section 203(f) of the Advisors Act, prohibiting him from association with any broker, dealer, or investment adviser, among other entities, and an order, pursuant to Rule 102(e), permanently suspending him from practicing before the Commission as an attorney. The Commission entered the administrative orders on May 30, 2013.