SEC: Adam and Daniel Kaplan Inflated Fees, Misappropriated $5M from at Least 60 Clients

The Securities and Exchange Commission (SEC) has filed a lawsuit against twin brothers and financial advisors, Adam S. Kaplan (CRD#: 6609019) and Daniel E. Kaplan (CRD#: 6609015), for misappropriating more than $5 million from at least 60 advisory clients.

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The brothers allegedly inflated the fees they charged clients and assessed a higher fee than the agreed amount, netting them a total of at least $540,000. They are also accused of misappropriating client funds to cover their lavish expenses, including jewelry, apparel, and hotel stays, and reimbursing clients who complained about their misconduct in “Ponzi-like payments.”

Read the full SEC complaint against brothers, ex-advisors Adam and Daniel Kaplan

The misappropriated funds totaled at least $4.5 million and were obtained through account transfers using payment-processing applications like PayPal, Venmo, and Zelle. The Kaplans had overseen a group of 277 clients, including friends, relatives, and unsophisticated investors.

The SEC’s lawsuit comes after the Kaplans were terminated by IHT Wealth Management for overbilling clients. Their Merrill Lynch terminations three years earlier were due to using “client logon credentials to access client accounts.” The Kaplans’ attorney called the SEC’s allegations “false and far-reaching” and believes his clients will be exonerated of all charges.

The Sonn Law Group is currently investigating allegations surrounding Adam and Daniel Kaplan. We represent investors in claims against negligent brokers and brokerage firms. If you or your loved one experienced investment losses, we are here to help. For a free consultation, please call us now at 866-827-3202 or complete our contact form.