Nicholas Rowe Barred Over Use of Leveraged, Inverse ETFs

The Securities and Exchange Commission (SEC) recently barred New Hampshire investment advisor, Nicholas Rowe, after charges surfaced claiming he allegedly used leveraged and inverse exchange-traded funds (ETFs) in a manner that was unsuitable for his clients. Rowe was the former owner of registered investment advisor Focus Capital Wealth Management. The state also alleged that he made misrepresentations regarding the fees to be charged and regarding his qualifications as an investment advisor, violating laws prohibiting advisors from engaging in unethical practices. The state launched an investigation into Rowe and his company in 2011, after claiming that they placed assets from elderly investors with low risk tolerances into unsuitable strategies without informing the clients. Many of the clients were widows between the ages of 60 and 74 who allegedly lost $1.9 million among them. The state then revoked Focus’s registration in March 2013 and ordered Rowe to pay $20,000 in fines and investigation costs, as well as more than $2 million in restitution to investors. Other investor claims against Rowe and Focus included Financial Industry Regulatory Authority (FINRA) claims alleging negligence and civil fraud, resulting in one ruling against the RIA that forced it to pay $1.8 million in restitution payments. Rowe was also registered with Jefferson Pilot Securities Corp in Bedford, New Hampshire from December 1990 until January 2006 and he has one customer dispute against him. The SEC permanently barred him from the industry.

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