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Broker Richard Crabtree Barred by SEC for Defrauding Client

Former Merrill Lynch Broker Accused of Misallocating Funds, Making Misrepresentations, and Unsuitable Recommendations

The United States Securities and Exchange Commission (SEC) has issued an order barring Richard Michael Crabtree from acting as a broker or investment adviser indefinitely. According to publicly available information, the former Merrill Lynch broker allegedly defrauded clients out of substantial amounts of money through misrepresentations, falsified documents, and omissions.

At Meyer Wilson, our investment fraud and broker misconduct lawyers have helped thousands of clients nationwide recover losses. We have secured over $350 million on behalf of harmed investors and will fight tirelessly to get you the results you deserve. If you sustained financial losses after investing with Richard Crabtree or another broker accused of misconduct, contact our office at (614) 532-4576 to schedule a free consultation. 

SEC Cease-And-Desist Order

On September 23, 2022, the Securities and Exchange Commission issued findings from an administrative proceeding imposing sanctions and a cease-and-desist order against Richard Michael Crabtree. The day before the order was issued, Crabtree was discharged from his employment as an investment adviser and broker with Merrill Lynch, Pierce, Fenner & Smith Incorporated. 

The order shows that while employed with Merill Lynch, Crabtree allegedly informed a client that he was investing $250,000 of their funds into a private investment partnership. The partnership never existed, so Crabtree reportedly fabricated documents and records to defraud the client into believing that the funds were invested and that the investment had “tripled in value.” 

Through a series of falsehoods, Crabtree continued to deceive the client into believing that mortgages were paid and additional stocks were purchased. The SEC found that Crabtree willfully violated several securities laws and barred him from acting as a broker or investment adviser or associating with member firms. 

Customer Disputes Against Crabtree

In addition to the regulatory findings by the SEC and employment separation, Crabtree faced a similar sanction by the State of Maryland due to his alleged investment fraud. The permanent bar and revocation stem from the same findings that the SEC case details.

Throughout his career, Crabtree had three settled customer disputes lodged against him. As noted on his BrokerCheck report, a $1.25 million settlement was reached with a customer who alleged that he made material misrepresentations over the course of four years.

A second customer dispute was settled for nearly $30k after Crabtree was accused of giving a client inaccurate information about sale proceeds. The final dispute resulted in a $75k settlement after a customer alleged that he made unsuitable investment recommendations and misallocated her account.

Did You Suffer Losses After Investing with Richard Crabtree?

If you invested with Richard Crabtree or another broker accused of wrongdoing, contact our office at (614) 532-4576 to schedule a free consultation. Let us help determine your legal options and whether you are entitled to a recovery for your losses.

The information contained in The Firm’s posts on its blog, fraud alerts, investigations or elsewhere on the site is based upon information obtained from other sources including, but not limited to, news outlets and federal, state, and regulatory agency filings. All suspects and subjects of postings herein are presumed innocent until proven guilty in a court of law or administrative action and any and all crimes are alleged until a court or regulatory agency finds otherwise .

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