SEC Takes Action Against Investment Adviser and Executives Over Misappropriation of Assets
Washington, D.C., March 7, 2025 – The Securities and Exchange Commission (SEC) has announced settled charges against registered investment adviser Momentum Advisors LLC, along with its former managing partner Allan J. Boomer and former chief operating officer Tiffany L. Hawkins. The SEC found that Boomer and Hawkins violated their fiduciary responsibilities by misusing private fund and portfolio company assets for personal gain.
Former COO Misappropriated Over $223,000 from Portfolio Companies
According to the SEC’s findings, between August 2021 and February 2024, Hawkins unlawfully diverted approximately $223,000 from portfolio companies tied to a private fund she co-managed with Boomer. This fund operated under the advisory of Momentum Advisors LLC.
Hawkins used company debit cards in more than 100 unauthorized transactions, covering personal expenses such as luxury vacations, clothing, and other non-business-related purchases. Additionally, she manipulated salary payments, ensuring she received compensation far beyond her authorized earnings.
Efforts to Conceal Financial Misconduct
To evade detection, Hawkins actively concealed her actions from Momentum Advisors, the portfolio companies’ bookkeeper, and SEC examiners. Despite multiple warning signs, Boomer failed to take reasonable supervisory action against Hawkins, enabling the continued misappropriation of funds.
Allan J. Boomer’s Role in Financial Mismanagement
The SEC order also found that Boomer engaged in financial misconduct by misusing fund assets to cover a $346,904 business debt. This liability should have been borne by an entity he co-owned with Hawkins. Instead, Boomer shifted the responsibility to the fund, wrongfully benefiting the entity at the expense of investors.
Furthermore, Momentum Advisors failed to establish and enforce adequate compliance policies and procedures, violating regulatory requirements. The firm also neglected its obligation to conduct mandatory fund audits, exacerbating the risks to investors.
SEC’s Statement on Fiduciary Breaches
Commenting on the case, Thomas P. Smith, Jr., Associate Regional Director in the SEC’s New York Office, emphasized the seriousness of the violations:
“As the orders find, Hawkins and Boomer breached their fiduciary duties and misused fund and portfolio company assets for their own benefit, all to the detriment of their clients.”
Legal Violations and SEC Penalties
The SEC determined that both Hawkins and Boomer violated the antifraud provisions of the Investment Advisers Act of 1940. Additionally, Momentum Advisors breached the compliance and custody rules under the Advisers Act.
Without admitting or denying the SEC’s findings, the accused parties agreed to the following penalties:
- Tiffany L. Hawkins: A $200,000 civil penalty and a permanent associational bar, preventing her from serving in a regulated financial capacity.
- Allan J. Boomer: An $80,000 civil penalty and a 12-month suspension from supervisory roles in the industry.
- Momentum Advisors LLC: A censure and a $235,000 civil penalty for failing to uphold regulatory compliance.
SEC Continues Crackdown on Investment Fraud
The SEC’s enforcement action underscores its commitment to holding investment advisers accountable for breaches of fiduciary duty. By imposing financial penalties and professional bans, the SEC aims to deter future misconduct and protect investors from fraudulent activities.
This case serves as a stark reminder that advisers who misuse client funds or fail to enforce compliance policies will face severe consequences.
