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Securities News Releases
Monday, May 17, 2010
Contact: Laura Egerdal, (573) 526-0949
Contact: Abe Rakov, (573) 526-4734
Carnahan Cracks Down on Springfield CPA, Case Moves to Federal Court
Jefferson City, MO – Secretary of State Robin Carnahan’s office closed its case against Springfield-area accountant Murphy M. Hubbard for a fraudulent securities scheme that concealed information from clients and decimated their savings. Hubbard still faces a trial in federal court for 11 felony counts of tax evasion and wire fraud. A federal grand jury indicted Hubbard in December 2009.
“It is unacceptable that Hubbard used the trust he built up with his clients to lie and take advantage of them,” Carnahan said. “My office has held Hubbard accountable for his actions, and I support the U.S. Attorney’s criminal action against him.”
The Securities Division’s case centered around two Springfield-area investors, both in their seventies, who had used Hubbard as their accountant for nearly three decades. They trusted him to manage a $250,000 educational trust for their grandchildren. Hubbard poorly managed the account and wrote thousands of dollars in checks to his own company, and the trust eventually dropped to less than $50,000 in value. Hubbard also failed to disclose to the elderly investors that he had a prior securities fraud charge and had three years’ probation put on his CPA license in 2003.
“Hubbard was our accountant for three decades, so I trusted him with the savings for our grandchildren’s education. We had no idea he had been in trouble in the past,” said the 73 year old investor from Rogersville. “I now know you should call the Secretary’s office to check on any new investment, even if you’ve known your accountant for years.”
Since the Securities Division’s case began, Hubbard has never requested a hearing on this matter or taken any steps to defend his actions.
A final order issued against Hubbard and two companies found that he offered unregistered securities and committed securities fraud. As a result, Hubbard and the companies were fined $39,000, including the maximum civil penalty of $10,000 each for securities fraud. Hubbard and the companies were ordered to pay the costs of the Securities Division’s investigation.
For more information regarding investments and fraud protection, visit the Secretary of State's online Missouri Investor Protection Center at www.MissouriSafeSavings.com or call the toll free Investor Protection Hotline at 1-800-721-1996.
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To find out more about Missouri's Secretary of State's office, visit www.sos.mo.gov