The Securities and Exchange Commission (“SEC”) has entered an Order barring Caleb Overton, the sole owner of Biltmore Wealth Management, LLC of Santa Barbara, California, from the securities industry for at least five years based on findings that he and Biltmore misused approximately $2.2 million in customer funds.
According to the allegations, Overton and Biltmore raised approximately $2.2 million from ten investors, eight of whom were preexisting Biltmore clients, to invest in Biltmore Capital, L.P., a private fund managed by Biltmore and Overton. Overton and Biltmore had promised investors that the fund would make relatively conservative investments in leading growth stocks, but instead took excessive risks in stock options and options on the SPDR S&P 500 ETF, an exchange-traded fund which seeks to replicate the return of the S&P 500.
The SEC further alleged that, while Biltmore and Overton had assured investors the fund’s risks would be mitigated by “stops” limiting losses to just 7-8%, the fund’s losses often exceeded those limits. Overton and Biltmore also mischaracterized the sources of the fund’s losses and returns in monthly letters to investors, failing to disclose that the fund’s options trading was the leading cause of losses in the fund. The fund collapsed in August 2015, losing nearly all of its value, and was dissolved in November 2015.
Mr. Overton’s FINRA BrokerCheck Report also reveals three customer complaints levied against him since 2011, each claiming that Mr. Overton misrepresented investments to his clients.
If you or someone you know lost money as a result of an investment recommended by Caleb Overton or Biltmore Wealth Management, please call the Frankowski Firm at 888.741.7503 or fill out this contact form.