Charles Caleb Fackrell is sentenced 63 months behind bars and three years of court supervision. The 36-year-old former North Carolina financial adviser, who worked with LPL Financial (LPLA), pleaded guilty to one count of securities fraud earlier this year. He now must pay his victims nearly $820K in restitution.
According to court documents, Fackrell ran an investment scam from approximately 5/2012 to 12/2014. During this time, he solicited about $1.4M from at least 20 investors. The companies he ran included Robin Hood LLC, Robin Hood Holdings LLC, Robinhood LLC, and Robinhood Holdings LLC.
Prosecutors contend that instead of using investors’ money as intended, Fackrell enriched himself in what North Carolina Secretary of State Elaine Marshall has described as “one of the most vicious financial crimes” the state has seen.
Fackrell promised yearly returns of 5-7%. He told investors that their funds would be secured by or invested in precious metals. Prosecutors say that not only did he spend just a “fraction” of these funds on these assets, as he’d promised, but also he diverted over $700K back to investors in Ponzi scam fashion and used the remaining funds to cover his own expenses. The government said that Fackrell tried to hide his scam by asking a third party to destroy documents and a computer that were part of his fraud.
According to Fackrell’s BrokerCheck report, there are eight pending customer disputes against him. Also, three of his clients have filed a complaint against LPL Financial accusing the firm of improper supervision of over $1M in financial transactions involving the former North Carolina broker. (LPL has come under fire over the last few years over allegations accusing the broker-dealer of inadequate supervision. The firm has paid millions of dollars to settle regulator claims.) Among his alleged victims are two plaintiffs in their eighties, meaning that Fackrell also committed elder financial fraud. Last year, FINRA permanently barred him from the role of broker or from any involvement with financial firms that sell securities to members of the public.
Previous to working for LPL, Fackrell was registered with Wells Fargo Advisors LLC (WFC), Suntrust Investment Services, and Morgan Stanley (MS).
Please contact our broker fraud law firm if you have sustained investment losses that you believe my be grounds for a securities claim.
Massachusetts Regulator Sues LPL Financial Over Broker’s Alleged Variable Annuity Abuses Involving Retirees, Stockbroker Fraud Blog, December 7, 2016