Understanding the Seriousness of Allegations and Its Impact on Investors
Let’s put this into perspective. This isn’t a simple article about the stock market’s ups and downs. This is a serious matter involving Jared Eakes, a formerly registered investment advisor and broker who now stands accused of defrauding investors out of $2.7 million. His alleged actions not only broke their trust but destabilized their financial futures.
Jared’s CRD number is #6618313. He dysregulated the lives of 17 clients across the southern states, using their money to pay down his own debts and squander on personal interests like gambling. Conduct a quick check on FINRA’s BrokerCheck using this number to learn more about his malpractices.
A Background on the Advisor, His Broker Dealer, and Past Complaints
Jared Eakes began his financial career in Jacksonville, Florida with Merrill Lynch, a prestigious multinational investment bank. He was registered with FINRA as a Merrill Lynch advisor for two years until 2018. Post that, he launched his own company named GraySail Advisors.
However, this venture raised the first red flags. With only $10 of assets under management, it had every appearance of an impressive entity, but, as it turned out, it was deceptive to investors.
A Simple Explanation and the FINRA Rule in Question
In the finance world, we term the alleged actions of Jared Eakes as an investment fraud – a serious violation of FINRA’s Rule 2020. This provision prohibits the use of manipulative, deceptive, or other fraudulent devices to impact a security’s sale. Let’s decompress that a bit. In layman’s terms, a breach of this rule means the advisor uses crafty means to trick investors and manipulate their investment decisions.
Repercussions and Lessons Learned
Historically, the repercussions of engaging in such fraudulent activities are enormous. Not only does the advisor’s professional life face colossal damage, but they are also subjected to stringent legal actions and penalties. Eakes now faces charges for his fraudulent activities that require returning the misappropriated money and paying civil penalties.
But what does this mean for investors? Here’s an alarming fact to startle you: The Association of Certified Fraud Examiners found that organizations worldwide lose an estimated 5% of their annual revenues to fraud. So, this case serves as a vivid reminder to us of the importance of due diligence.
As Warren Buffet rightly said, “Risk comes from not knowing what you’re doing.” Hence, before entrusting finances to an advisor or broker, investors must prioritize verifying their credentials, registration status, and track record. Be vigilant about regular audits of your investments and keeping the communication lines candid and open with your advisor.
Through everything, remember, this article isn’t meant to dishearten investors but to highlight the importance of awareness and caution in your financial journey. It reiterates the peculiarity of our financial world—there’s room for impressive gains, but also potential for dangerous falls if you’re not cautious.
Let’s not take the role of a financial advisor lightly. A sound advisor doesn’t just provide expertise; they are stewards of trust with an ethical responsibility to champion the interests of their clients. Remember these lessons, tread wisely, and you’ll be well-armed to navigate the finance world successfully.
