Former Florida Broker Joseph Michael Todd Faces SEC Charges for Defrauding Vulnerable Investors
The White Law Group is investigating potential securities fraud claims involving former Centaurus broker Joseph “Michael” Todd and the liability his employers may have for failure to properly supervise his activities.
The Securities and Exchange Commission (SEC) has reportedly taken legal action against Joseph Michael “Mike” Todd, a former resident of Panama City, Florida, along with his entities, Todd Financial Services, LLC (TFS), and TFS Insurance Services LLC (TFS Insurance). The charges stem from Todd’s alleged fraudulent activities. Todd purportedly deceived at least 20 brokerage customers, many of whom were seniors and disabled individuals, resulting in losses of at least $3 million, according to the SEC’s complaint.
According to the SEC’s complaint, Todd, while working as a registered representative and investment adviser representative for Centaurus Financial, allegedly engaged in deceptive practices to obtain investor funds. He reportedly instructed his brokerage customers to write checks payable to his entities, TFS, TFS Insurance, or himself, assuring them that their funds would be invested in various securities. However, instead of fulfilling these promises, Todd allegedly misappropriated the investors’ funds for personal use.
Forged Documents and Ponzi-Like Payments
The SEC alleges that Todd used the ill-gotten funds to finance an extravagant lifestyle that included real estate acquisitions, boating adventures, hunting trips, visits to casinos, and expenditures related to adult entertainment.
To conceal his alleged fraudulent activities and keep the scheme running, Todd is accused of presenting forged account statements and portfolio holdings statements to defrauded customers. These fake documents falsely indicated that the customers were invested in the products Todd had promised them.
The SEC’s complaint highlights Todd’s alleged involvement in Ponzi-like payments. He purportedly used other customers’ funds to make regular deposits into one customer’s account, misleading them into believing that these were legitimate interest payments or regular distributions from an investment.
Legal Actions and Consequences
The SEC’s complaint was reportedly filed in federal court in the Middle District of Florida. It allegedly charged Todd and his entities, TFS and TFS Insurance, with violating various securities laws, including the antifraud provisions of Section 17(a) of the Securities Act of 1933, as well as Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.
The Financial Industry Regulatory Authority (FINRA), the self-regulator, reportedly suspended Todd in April 2023. The suspension was in connection with Todd’s alleged failure to “comply with an arbitration award or settlement agreement or to satisfactorily respond to a FINRA request to provide information.”
Joseph “Michael” Todd – FINRA BrokerCheck Profile
According to Todd’s FINRA brokercheck report, he has 14 customer complaints filed against him. Allegations include recommending high risk and illiquid investment and misappropriated funds, among others.
The FINRA BrokerCheck tool is a free online tool that allows investors to research and verify the background and credentials of financial brokers, brokerage firms, and investment advisors registered with FINRA.
BrokerCheck provides investors with detailed information about the professional history, qualifications, and regulatory actions of brokers and brokerage firms. Investors can use the tool to verify whether a broker or brokerage firm is registered with FINRA, as well as to review their employment history, licensing status, and any regulatory actions or complaints filed against them.
According to his FINRA BrokerCheck report, Todd was reportedly affiliated with the following firms during his career in the securities industry, among others:
08/29/2016 – 07/21/2022, CENTAURUS FINANCIAL, INC. (CRD#:30833), CRYSTAL RIVER, FL,
B, 01/04/2007 – 08/30/2016, INVESTORS CAPITAL CORP. (CRD#:30613), HOMOSASSA, FL
Broker Due Diligence
Brokers and brokerage firms owe a duty of care and loyalty to their customers. The broker must use the standard of care and diligence needed to protect the customer’s interest. Failure to fulfill that duty may constitute negligence or malpractice by a broker. The duty of loyalty requires that the broker refrain from self-dealing and place the interests of the customer first.
FINRA Dispute Resolution is an arbitration venue for investors with claims against their brokerage firm or financial professional. It provides investors with an opportunity to attempt to recoup their investment losses and is an alternative to filing such claims in court.
If you have suffered losses investing with Joseph “Michael” Todd, the securities attorneys at the White Law Group may be able to help you. For a free consultation with a securities attorney, please call (888) 637-5510.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm dedicated to helping investors in claims in all 50 states against their financial professional or brokerage firm. Since the firm launched in 2010, it has handled over 700 FINRA arbitration cases.
Our firm represents investors in all types of securities related claims, including claims involving stock fraud, broker misconduct, churning, unsuitable investments, selling away, and unauthorized trading, among many others.
With over 30 years of securities law experience, The White Law Group has the expertise to help investors defrauded in securities, investment and financial business transactions attempt to recover their investment losses. For more information, please visit our website, www.whitesecuritieslaw.com.