Julie Darrah Facing SEC, Client Disputes Concerning Misappropriation

Investors potentially experienced losses because of securities broker Julie Anne Darrah (also known as Julie Banuelos) [CRD: 2102014, Orcutt, California], according to disclosures on FINRA BrokerCheck. According to the regulator, Julie Darrah worked for Mutual Securities Inc. from June 28, 2013, to January 4, 2022. Here’s more about the securities broker’s disclosures.

Mutual Securities Inc. Investor Accused Darrah Of Misappropriation

Specifically, on December 7, 2023, a Mutual Securities Inc. client filed FINRA Arbitration No. 23-03394 about Julie Darrah. Supposedly, Darrah sold nearly all of the securities in the client’s accounts and transferred the proceeds to the client’s bank accounts, which she controlled. The securities broker later allegedly misused funds from the client's bank accounts. Therefore, the client requested $702,647.97 in compensation from Mutual Securities Inc. or Darrah. Evidently, this arbitration is pending a resolution.

United States Securities and Exchange Commission Charged Julie Darrah With Misappropriation of Client Funds

Also, on October 20, 2023, the United States Securities and Exchange Commission (SEC) initiated Case: 2:23-cv-08843 against Julie Darrah. Notably, the SEC alleged that Darrah misappropriated funds from client bank and brokerage accounts and used those funds for personal expenses and to support PC&J Joint Ventures LLC, a restaurant business she owned.

The SEC alleged that Darrah engaged in unauthorized activities from at least November 2016 through July 2023, while she worked for Vivid Financial Management Inc., an SEC-registered investment adviser where she served as president and chief compliance officer. During this period, Darrah allegedly exploited her role as an investment adviser by misusing her clients' funds, many of whom were elderly women who had placed trust in her financial guidance.

The complaint stated that Darrah had discretionary authority over her clients’ brokerage accounts and was appointed as a trustee or given power of attorney by several of them. Instead of fulfilling her fiduciary duty to act in their best interests, she allegedly transferred approximately $2.25 million from their accounts for personal use and to benefit PC&J Joint Ventures LLC. Furthermore, Darrah is accused of submitting false and misleading information in Vivid Financial Management’s regulatory filings to conceal her misconduct.

As a result, the SEC contends that Darrah violated Section 17(a)(1) of the Securities Act, Section 10(b) of the Exchange Act, and Rules 10b-5(a) and (c) thereunder. Additionally, she allegedly violated Sections 207, 206(1), and 206(2) of the Advisers Act and aided and abetted Vivid Financial Management’s violation of Section 206(4) of the Advisers Act.

According to the Complaint, SEC seeks permanent injunctions, disgorgement of ill-gotten gains, and civil penalties. On October 20, 2023, the U.S. District Court for the Central District of California Western Division issued a Preliminary Injunction. The case remains pending.

Darrah Discharged for Unauthorized Taking of Client Property

Specifically, Wealth Enhancement Advisory Services disaffiliated with Darrah on September 15, 2023. Allegedly, Darrah underwent an internal review for alleged wrongful and unauthorized taking of client property, and violations of investment-related securities laws, including those related to the custody of client assets. Allegedly, her termination also stemmed from the alleged failure to cooperate with the firm’s internal review.

Impacted By Securities Broker Julie Darrah?

Are you looking for more information about Julie Darrah? If you incurred losses, get in touch with Soreide Law Group online or at (888) 760-6552 and speak with a securities attorney about a possible recovery. Soreide Law Group has recovered losses for investors throughout the United States, works on a contingency fee basis, and advances all costs. Darrah and brokerage firms Darrah worked for deny any allegations of sales practice violations.