The U.S. Securities and Exchange Commission published a statement on a jury verdict in the U.S. District Court for the District of Massachusetts finding investment adviser Jeffrey Cutter and Cutter Financial Group, LLC liable for violating Section 206(2) of the Investment Advisers Act of 1940, based on failures to disclose significant upfront commissions and other conflicts of interest to clients. The verdict followed a seven-day trial and just over five hours of deliberation. The jury found for the defendants on the SEC’s claims under Sections 206(1) and 206(4) of the Act. The SEC’s Acting Director of Enforcement, Samuel Waldon, framed the Section 206(2) finding as holding the defendants accountable for breaching fiduciary duties to clients, noting the agency’s intent to pursue investment adviser misconduct.
U.S. Securities & Exchange Commission 2025-04-24
U.S. Securities and Exchange Commission announces jury verdict finding Cutter Financial Group and Jeffrey Cutter liable under Advisers Act Section 206(2)
The U.S. Securities and Exchange Commission announced a jury verdict finding investment adviser Jeffrey Cutter and Cutter Financial Group, LLC liable for violating Section 206(2) of the Investment Advisers Act of 1940 due to undisclosed commissions and conflicts of interest. The jury ruled in favor of the defendants on claims under Sections 206(1) and 206(4). The SEC emphasized its commitment to addressing investment adviser misconduct.