The Oklahoma Securities Department has moved to sue a former Edmond man who was banned from being a broker or adviser in the state after he opened a website where he traded investment tips for cash.
In court documents filed Monday in Oklahoma County District Court, the Securities Department claims Jasper “Jay” Biddy IV, who now lives in Colorado, ran the website biddytrades.com. The website charged users subscription fees of up to $990 a year for Biddy's investment tips, according to court documents.
Biddy said he voluntarily converted his website to a free service in March after the Securities Department contacted him.
Most of the site has since been taken down and a message on the home page says it is under construction.
“I contacted the Securities Department multiple times over the last three months to try to resolve this issue, but they have ignored me at times,” Biddy said. “I have done everything they have asked and more, yet they still filed a lawsuit. It's a little confusing.”
The website drew more than 200 members who paid more than $116,000 in membership fees to gain access to Biddy's investment advice, according to court documents.
At least two subscribers were Oklahoma residents, according to the agency's lawsuit.
Biddy failed to disclose on the website that Oklahoma securities regulators had previously found that he had engaged in unethical and dishonest business practices, the lawsuit claims.
The agency barred Biddy from doing business in the state in 2007, according to department records, when he was an investment adviser for the Edmond-based firm Legacy Wealth Management LLC. A Securities Department investigation found that Biddy and Legacy Wealth Management had charged clients excessive advisory fees.
In its lawsuit filed Monday, the Securities Department also claims Biddy violated the agency's ban by managing a former Oklahoma client's brokerage accounts, and failed to tell the client about the ban.
The lawsuit seeks $25,000 in restitution for the unnamed client and also asks the court to impose a $10,000 civil penalty against Biddy.
Biddy said the accusations stem from a childhood friend whom he had a falling out with after he lost money on Biddy's investment advice. Biddy agreed to pay the friend $25,000 to cover market losses on investment decisions he made for his friend and is actively paying him back, he said.
“It's basically a friend who is disenchanted with his investment returns,” Biddy said. “I wasn't acting as an investment adviser. I did all of the work for free — I was just helping out a friend.”
I contacted the Securities Department multiple times over the last three months to try to resolve this issue, but they have ignored me at times. I have done everything they have asked and more, yet they still filed a lawsuit. It's a little confusing.”
Jasper “Jay” Biddy IV,