Most investment advisers solicit clients by claiming some kind of extraordinary ability. “We’re really smart,” for example. Or, “Our models are better and more accurate than anyone else’s.” Everyone is, on some level, looking for someone whose ability to make money seems magical. So in the whole scheme of things, it’s not that weird that Sean David Morton raised more than $6 million by claiming he literally had extraordinary abilities. As in Extra Sensory Perception. The trouble is, he did not, actually, and so now he is being sued by the SEC.
Morton made numerous materially false representations relating to his psychic abilities in order to solicit investors for the Delphi Investment Group. For example, Morton wrote to potential investors in his July 20, 2006 newsletter that: “I have called ALL the highs and lows of the market, giving EXACT DATES for rises and crashes over the last 14 years.” (emphasis in original.) The Commission alleges that this assertion, like others Morton made in soliciting investors, is false.
If he had been actually psychic, it would have been a different story.
For Psychic, Suit Came as Surprise [NYT]
SEC Charges Nationally Known Psychic in Multi-Million Dollar Offering Fraud [SEC]
Sean David Morton [Delphi Associates]
