The Indiana secretary of state has issued a cease-and-desist order against an unregistered financial planner whom authorities accused of using over $2 million in client funds to buy a house, among other allegations.
The secretary's securities division issued the order against Alexander Joyce, who allegedly induced several clients to enter into an investment advisor agreement with his firm without being registered as an advisor, and against his related business entities ReJoyce Financial and ReJoyce Wealth Management.
The order also named investment advisor Joel Parady, according to a press release Wednesday. Parady is listed in FINRA's BrokerCheck as a registered investment advisor and former registered broker.
Joyce, Parady and the named businesses were ordered to stop offering or engaging in investment advisor services and offering or selling securities, among other activities. The order petition indicates that Charles Schwab Corp. made a complaint to the secretary of state earlier this month on behalf of two Indiana residents who had recently become Joyce's clients through ReJoyce Financial.
Clients claimed they were drawn to Joyce's business because of television ads and his offering various financial services, the statement from Indiana Secretary of State Diego Morales said. Joyce, whose LinkedIn profile lists him as ReJoyce Financial's president and CEO, didn't disclose to the clients that he wasn't a registered investment advisor, the order petition says.
In meetings with the clients, Joyce represented that he would transfer their nearly $2.6 million in assets to a new JPMorgan Chase account. A state investigator learned the funds instead were transferred from the clients' Schwab account to a Chase bank account with Rejoyce Wealth Management listed as the account holder and Alexander Joyce listed as a signer, according to the petition.
More than $2 million of those funds were transferred to a title company to buy a home that was put in ReJoyce Wealth Management's name, the petition said, citing documentation.
"Joyce personally met with clients and discussed how their funds would be invested in 'structured' securities and that the funds would be placed in an account at JPMorgan Chase. By conducting business in this fashion, Joyce is alleged to have violated [the] Indiana Uniform Security Act, which requires all investment advisors and their representatives to be registered in order to conduct business in Indiana," the release stated.
Joyce also is alleged to have engaged in securities fraud and investment advisor fraud, according to the release.
Joyce, his two named businesses and Parady "engaged in a device, scheme, artifice to defraud by providing documentation and making misrepresentations regarding establishing of an investment advisor-client relationship and using that relationship to deprive clients of almost $2.6 million dollars," the order petition states.
At the time of the transactions, Joyce was engaged only as a solicitor for another investment advisory firm. A solicitor is someone who is compensated for referring business to investment advisory firms but does not advise clients or make investment decisions on their behalf, the office said.
