SEC Charges Two Men in $8.7M Fraud Targeting Veterans
The SEC has charged Christopher Dinelli and Jacob Frankel for allegedly defrauding 35 investors, raising over $8.7 million through their fund.
The Securities and Exchange Commission filed charges Thursday against Christopher Kenji Dinelli and Jacob David "Kobe" Frankel, accusing the two men of running a fraudulent investment scheme that collected more than $8.7 million from 35 investors, with military veterans among those targeted, according to an agency announcement.
The alleged fraud was conducted through a fund the pair operated, which the SEC contends was used to solicit investor funds under false or misleading pretenses. The scheme's deliberate focus on veterans raises the severity of the allegations, as regulators have repeatedly warned that former service members are disproportionately targeted by investment fraud due to their access to pension benefits and retirement savings.
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The SEC did not disclose in its initial announcement what specific misrepresentations were made to investors or how the funds were allegedly misused, but charges of this nature typically involve accusations that operators misappropriated investor money, fabricated returns, or misled investors about the nature of the underlying investments. The agency's action signals continued enforcement focus on schemes that prey on vulnerable or affinity-based communities.
Dinelli and Frankel now face civil charges from the commission, which can seek monetary penalties, disgorgement of ill-gotten gains, and bars from the securities industry. Parallel criminal proceedings by the Department of Justice are common in cases of this scale, though no such action was referenced in the SEC's announcement. Investors who believe they may be victims of similar schemes are encouraged to report concerns directly to the SEC.
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