Cary Edward Urich Agrees to Settle SEC Charges Over Alleged Breaches of Fiduciary Duty, Subject to Court Approval

Investment adviser Cary Edward Urich has consented to a final judgment that would permanently enjoin him from violating the antifraud provisions of the Investment Advisers Act of 1940, the SEC said in a litigation release dated Oct. 30.

The SEC filed its complaint Oct. 29 in the US District Court for the District of South Carolina. The release says the case concerns Urich's use of leveraged and/or inverse exchange-traded funds in discretionary client accounts while Urich was an investment adviser representative at United Planners' Financial Services of America A LP. The proposed judgment, which is subject to court approval, would also enjoin Urich from acting as or associating with an investment adviser for two years and impose a civil money penalty of $100,000. Urich consented without admitting the allegations, according to the release.

The SEC alleges that from April 2020 to November 2023, Urich used his discretionary authority over the accounts of 54 investment advisory clients, "most of whom were elderly," to put large concentrations of their savings and retirement funds into complex leveraged and/or inverse ETFs that did not suit their investment profiles, objectives or risk tolerances.

According to the complaint, the ETFs' prospectuses and regulatory notices, which Urich reviewed, cautioned against investing in the funds for longer than one day. The complaint alleges Urich held the products in client accounts for an average of 798 days. The complaint also alleges the 54 clients lost approximately 70% of their investments in the products.

In a related administrative proceeding, the SEC instituted settled proceedings against United Planners arising out of the same conduct, the release says.