Former Morgan Stanley adviser accused of ‘Ponzi scheme’ in SEC suit

A previous Morgan Stanley adviser was sued by federal securities regulators for using clients’ cash to pay back for personalized expenditures like a Tesla Inc. automobile, credit history card bills and dollars transfers.

Shawn E. Excellent, 55, from Wilmington, North Carolina, had clients deliver resources to his own lender account to supposedly make small-risk investments in authentic-estate growth jobs, in accordance to a Securities and Trade Fee grievance submitted in federal courtroom. Great defrauded investors — like retirees — out of at minimum $4.8 million, resulting in more than $2 million of losses, the regulator explained.

A spokesperson for Morgan Stanley mentioned the bank is examining the matter and that the alleged carry out is “plainly unacceptable.” Very good is no lengthier employed by the bank. A consultant for Excellent did not right away answer to a ask for for comment.

Good’s Ponzi plan went on for about a decade, according to the regulator. He applied clients’ dollars to spend payments, reimburse other investors and to transfer hard cash on Venmo for transactions with matter strains this kind of as “because you’re sexy” and “Hotel for Destiny.”

Excellent explained to customers that the bets he was producing on their behalf have been small-risk and would pay returns concerning 6% and 10% more than three to 6 months, but he in no way offered a penned agreement, in accordance to the SEC.

[MORE: SEC freezes assets of alleged $449 million Ponzi schemers]