Wealth Enhancement Group (WEG), one of the country's premier and growth-focused registered investment advisors, has initiated legal action against Julie Darrah, the erstwhile leader of a firm it procured. The lawsuit accuses her of orchestrating a prolonged deceit that deprived elderly investors of several million dollars.
WEG claims that Darrah, previously the president and chief compliance officer at Vivid Financial Management in Orcutt, California, cultivated deep bonds with her clientele. However, she allegedly exploited this trust to swindle a select group of these clients, some of whom were octogenarians and one, a resident of a memory-care establishment. This information is derived from the complaint WEG lodged in a Minnesota federal court, aligning with its headquarters' location.
Currently, Darrah remains unresponsive to outreach attempts. Her professional profile on LinkedIn is deactivated, and available court documents do not identify any legal representation on her behalf.
Following a detailed examination into the alleged fraud, WEG dismissed Darrah on September 15.
Due to the ongoing legal proceedings, WEG expressed its limited capacity to provide extensive details but highlighted that Darrah's termination was motivated by substantial grounds. The company further stated:
Because the legal case is ongoing, we are limited in what we can say. However, we can confirm that the advisor in question has been terminated for cause. We are conducting a thorough internal review with support from outside legal counsel and external experts and are cooperating with government authorities in their review of the matter. The safety and security of our clients’ assets is our number one priority.
In December 2021, WEG finalized its acquisition of Vivid, a firm that managed assets worth nearly $574 million, primarily catering to individual clients with some businesses and charities in its portfolio.
Despite these recent events, the Vivid team, now integrated into WEG, remains operational, supported by WEG's central office. The lawsuit portrays Darrah as a maverick, deceiving her team, WEG's due diligence committee, and Vivid's custodian and collaborators.
Drawing upon WEG's complaint, Darrah, a well-regarded figure in the tight-knit community of Orcutt, skillfully built her image as a generous patron of local ventures. However, her alleged misconduct, spanning over an extended period before WEG's acquisition of Vivid, involved overstepping professional boundaries for a financial advisor.
She reportedly aligned with a disbarred attorney who facilitated her undue control over client finances through a web of legal documents. With this, Darrah is accused of channeling vast client funds to a seemingly legitimate bank, subsequently diverting these funds to her personal accounts.
Although WEG refrained from discussing the enhancement of its vetting process for upcoming mergers, it stressed that its scrutiny during Vivid's acquisition was exhaustive. Unfortunately, Darrah's alleged camouflage was so proficient that anomalies weren't discernible.
The lawsuit further elaborates on her purported actions, which involved impersonating clients, forging checks, and fabricating signatures on client documents.
Post her termination, WEG claims Darrah has made attempts to engage with her prior clients, providing them assurances of compensation and presenting them with retroactive documentation.
In its lawsuit, WEG aims to retrieve the multi-million dollar losses and prevent Darrah from any further engagement with her previous clients. WEG remains steadfast in its commitment to compensating its affected clients and seeks damages arising from its association with Darrah and her firm.
