Firm faces fraud suit

Head of Summit Wealth Management accused in $17M case. Regulators say he used Ponzi-like scheme.

Federal regulators sued the head of an Atlanta money management firm, alleging it used a Ponzi-like scheme to cover up $17 million in losses affecting about 200 clients in a trio of private investment funds.

The Securities Exchange Commission said Wednesday that it is seeking an emergency court order freezing the assets of Angelo A. Alleca and his firm, Summit Wealth Management, who face civil charges of securities and investment management fraud.

The SEC filed the complaint Tuesday in U.S. District Court in Atlanta.

The SEC said it was told that Summit Wealth Management oversees about $500 million in more than 2,200 client accounts. But the alleged fraud appears to be limited to a so-called “fund of funds” launched in 2004 and two hedge funds that Alleca created later, according to the SEC.

“We haven’t alleged anything with regard to the rest of the accounts,” said William Hicks, associate director of the SEC’s Atlanta regional office.

Neither Alleca nor his attorney could be reached for comment. According to Summit Wealth Management’s website, the firm has at least 25 employees in four offices in Atlanta, Chicago, San Antonio and Beverly Hills, Calif. The company manages trusts and provides investment management and financial planning services.

On Monday, Jace Brooks, a financial planner at Summit Wealth Management, was sworn in as a Gwinnett County commissioner, replacing former Commissioner Shirley Lasseter, who pleaded guilty to a bribery charge. Brooks is not named in the SEC’s complaint.

“I’m furious about [the suit],” said Brooks, who heard of the SEC’s complaint Wednesday afternoon. “... It’s not something I want to be a part of, by any stretch.” He said none of his clients had invested in the funds named in the SEC’s complaint.

Brooks, 43, who joined the firm last year, said neither he and nor, as far as he knows, anyone else at the firm except Alleca were involved in the alleged fraud.

The SEC has asked the court to appoint a receiver to oversee the firm, and Brooks said he was waiting to hear from the company’s attorney to know what he could tell his clients.