The US Securities and Exchange Commission charged investment adviser Darren J. Caris and his advisory firm, Caris Investment Partners, Inc., with allegedly defrauding clients through a cherry-picking scheme, the SEC said in a litigation release dated Oct. 8.
\nThe SEC's complaint was filed Oct. 6 in the US District Court for the Southern District of California, according to the release, which says the firm is based in Encinitas, California. According to the complaint, from December 2023 to April 2024, Caris used his firm's block trading account to place trades and later in the day \"disproportionately allocate profitable trades to his personal account and unprofitable trades to some of his clients' accounts.\"
\nThe complaint also alleges that Caris and the firm made false and misleading statements to clients and prospective clients. According to the release, those statements concerned the allocation of trades, the management of conflicts of interest relating to Caris's own personal trading, and the move to a different broker-dealer custodian.
\nThe SEC charges Caris and Caris Investment Partners with violating the antifraud provisions of the Securities Act, the Securities and Exchange Act and the Investment Advisers Act, according to the release. The agency seeks permanent injunctions, disgorgement with prejudgment interest and civil penalties.
\nThe investigation was conducted by staff in the SEC's Los Angeles Regional Office, the release says.
", "text": "The US Securities and Exchange Commission charged investment adviser Darren J. Caris and his advisory firm, Caris Investment Partners, Inc., with allegedly defrauding clients through a cherry-picking scheme, the SEC said in a litigation release dated Oct. 8.\n\nThe SEC's complaint was filed Oct. 6 in the US District Court for the Southern District of California, according to the release, which says the firm is based in Encinitas, California. According to the complaint, from December 2023 to April 2024, Caris used his firm's block trading account to place trades and later in the day \"disproportionately allocate profitable trades to his personal account and unprofitable trades to some of his clients' accounts.\"\n\nThe complaint also alleges that Caris and the firm made false and misleading statements to clients and prospective clients. According to the release, those statements concerned the allocation of trades, the management of conflicts of interest relating to Caris's own personal trading, and the move to a different broker-dealer custodian.\n\nThe SEC charges Caris and Caris Investment Partners with violating the antifraud provisions of the Securities Act, the Securities and Exchange Act and the Investment Advisers Act, according to the release. The agency seeks permanent injunctions, disgorgement with prejudgment interest and civil penalties.\n\nThe investigation was conducted by staff in the SEC's Los Angeles Regional Office, the release says." }, "claims": [ { "evidence": "U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26669 / October 8, 2026 Securities and Exchange Commission v. Darren J. Caris and Caris Investment Partners, Inc. , No. 26-civ-5714 (S.D. Cal. filed Oct. 6, 2026) SEC Charges Encinitas Investment Adviser and his Advisory Firm in Alleged Fraudulent \"Cherry-Picking\" Scheme The Securities and Exchange Commission charged Darren J. Caris and his investment advisory firm Caris Investment Partners, Inc., based in Encinitas, California, for allegedly defrauding clients by conducting a cherry-picking scheme and making related false and misleading statements.", "kind": "charges", "receipt": "LR-26669" } ], "contact": "research@alphanume.com", "corrections": [], "dek": "The SEC alleges Caris and his firm also made false and misleading statements to clients about trade allocations, conflicts of interest and a move to a different custodian.", "desk": "regulatory", "desk_label": "Regulatory Actions", "entities": [ { "basis": "identifier or the record itself", "in_headline": true, "name": "Darren J. Caris", "role": "respondent" } ], "facts": [ { "key": "respondent", "receipt": "LR-26669", "source": { "path": "text", "value": "Darren J. Caris" }, "text": "Darren J. Caris" }, { "key": "conduct_phrase", "receipt": "LR-26669", "source": { "path": "text", "value": "cherry-picking scheme" }, "text": "cherry-picking scheme" }, { "key": "release_date__short", "receipt": "LR-26669", "source": { "path": "index:date", "value": "2026-10-08" }, "text": "Oct. 8" } ], "guid": "tag:alphanume.com,2026:news:s_dmz2zqwsgkk4", "headline": "SEC Charges Darren J. Caris Over Alleged Cherry-Picking Scheme", "id": "s_dmz2zqwsgkk4", "kind": "story", "legal": { "allegation": true, "stage": "charged" }, "published_at": "2026-10-08T16:07:31+00:00", "receipts": [ { "filed": "2026-10-08", "form": "sec-lr", "id": "LR-26669", "label": "SEC litigation release LR-26669", "source": "sec_release", "type": "sec_release_no", "type_label": "SEC release", "url": "https://www.sec.gov/enforcement-litigation/litigation-releases/lr-26669" } ], "record_date": "2026-10-08", "schema": "alphanume.news/item/v1", "slug": "sec-charges-darren-j-caris-over-alleged-cherry-picking-scheme", "status": "published", "type": "sec_litigation", "updated_at": "2026-10-08T16:07:31+00:00", "version": 1, "url": "https://news.alphanume.com/stories/sec-charges-darren-j-caris-over-alleged-cherry-picking-scheme", "api_url": "https://news.alphanume.com/api/v1/stories/s_dmz2zqwsgkk4" }