Bill Carlton: SEC Alleges Cherry-Picking Fraud by Ex-Cetera Advisor

Former Bellevue, Washington financial advisor Bill Carlton (CRD# 1215541) was recently charged in connection with allegations that he defrauded customers in a cherry-picking scheme. Financial Industry Regulatory Authority records show that he was most recently registered as a broker and an investment advisor with Cetera.

A Securities and Exchange Commission litigation release describes the regulator’s charges against Mr. Carlton. Issued on September 27, 2024, the release states that the SEC alleges Mr. Carlton conducted a multi-year cherry-picking scheme that defrauded his customers. He allegedly “profited at his clients’ expense by cherry picking trades using personal trading accounts and observing the daily price movements of the securities,” according to the release. In traditional cherry-picking scheme form, it alleges further, he delayed allocating securities until he observed their prices’ movement over the trading day, then “disproportionately allocated profitable trades to their personal accounts and unprofitable trades to their clients’ accounts.” As a result, he allegedly generated more than $5 million “in illicit first-day profits through the scheme.” In connection with these allegations, the SEC has charged him with violations of securities law and seeks permanent injunctions, disgorgement, and civil penalties.

Mr. Carlton’s BrokerCheck report discloses his termination from Cetera Advisors. Filed in December 2023, it states that the firm fired him in connection with allegations of “inappropriate trading practices.”

According to the Financial Industry Regulatory Authority, Bill Carlton holds 40 years of securities industry experience. Previously based in Bellevue, Washington, he was registered with Cetera from 2020 until 2024. His registration history includes First Allied Securities, First Montauk Securities, Prudential Securities, Smith Barney Shearson, Lehman Brothers, and Foster & Marshall. His credentials include the passage of six securities industry qualifying exams: the General Securities Principal Examination, or Series 24; the General Securities Representative Examination, or Series 7; the National Commodity Futures Examination, or Series 3; the Securities Industry Essentials Examination, or SIE; the Uniform Securities Agent State Law Examination, or Series 63; and the Uniform Investment Adviser Law Examination, or Series 65. (Information current as of September 29, 2024.)

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