A former Florida-based investment advisor is now facing federal charges for orchestrating a fraud that reportedly swindled investors out of over $2.7 million.
The Justice Department alleges that Jared Eakes misrepresented himself on an online marketplace for advisors considering selling their practices. He claimed to be a high-net-worth advisor managing substantial assets and expressed interest in acquiring books of business from other advisors, as stated in the indictment.
Following his acquisitions, Eakes is accused of transferring assets from 17 clients' IRAs to custodial accounts under his control, unbeknownst to the investors. He allegedly diverted these funds to various personal accounts, covering expenses such as lavish payments to a Las Vegas casino company, student loan repayments, and even to make partial restitution to previous victims.
Despite facing four charges of fraud, Eakes has pleaded not guilty. He is currently in custody, pending trial, as ordered by a federal judge. His attorney, public defender Lisa Call, has refrained from commenting on the case.
This indictment follows closely on the heels of an amended complaint by the Securities and Exchange Commission (SEC), which detailed civil charges against Eakes almost a year earlier. The SEC highlighted difficulties in serving him notice due to deliberate evasion by Eakes and possibly his family.
The SEC also noted that Eakes faced other disciplinary measures, including a permanent industry ban from the Alabama Securities Commission. Notably, Eakes failed to appear at any of these disciplinary hearings.
His arrest was executed by FBI Special Agent Christine Windness on May 20 in Jacksonville. Eakes had a brief stint as a broker with Merrill Lynch between 2017 and 2018 before founding GraySail Advisors, a Jacksonville-based investment advisory firm last registered with the SEC in 2019. He was also linked to several other entities implicated in the fraudulent activities.
Victims, only identified by initials in the indictment, span several states including Florida, Alabama, Arkansas, and Missouri.
From May to November 2019, Eakes is alleged to have stolen approximately $2 million from 10 clients of an Alabama broker whose business he had purchased. The SEC claims Eakes often sold fake promissory notes through Small World Capital, a now-defunct firm, by forging signatures and manipulating client documents to facilitate unauthorized transactions.
In 2019, Eakes also acquired clients from an Arkansas broker and reportedly began misappropriating their assets almost immediately. The majority of these thefts involved the fraudulent sale of Small World promissory notes.
Special Agent Windness disclosed in an April affidavit that the supposed business activities of Small World were non-existent according to the company's head.
Eakes is scheduled for trial later this year, once the Middle District of Florida commences its next session on July 1.
