Efstratios “Elias” Argyropoulos, a Santa Barbara–based stock promoter, and his firm, Prima Capital Group, agreed last week to settle with the United States Securities and Exchange Commission (SEC) after the federal agency levied fraud charges against him. The SEC was pursuing Argyropoulos for allegedly defrauding investors out of nearly $3.5 million by saying he would use their funds to buy shares of Facebook and Twitter before their initial public offerings (IPOs). Instead, the agency said, Argyropoulos used the money to day trade stocks and options; he also used some of it as hush money for clients who complained when their social media site shares never materialized. The SEC deal includes barring Argyropoulos from working for an investment adviser or broker-dealer. He will also pay fines, the amounts of which will be determined at a later date.
In a related case, the SEC also announced actions against Austin, Texas-based Khaled Eldaher, who allegedly worked for Argyropoulos on the side and received half the markup on the Facebook shares. Eldaher worked for another broker-dealer at the time, which fired him for selling securities outside the firm. Working with Argyropoulos, he sold $362,887 worth of Facebook shares and received a $15,478 check from Argyropoulos’s Prima Capital Group. The case will be heard by an administrative law judge.
Argyropoulos is familiar to industry watchdogs. According to an article in the Pacific Coast Business Times published in April of this year, one of his clients filed suit over an alleged false promise to ensure his stock purchases would be adjusted to always remain profitable. That same article also pointed to previous trouble in Argyropoulos’s history, including $500 fines in 1983 (for putting his own money into a brokerage account of a family friend to cover trading losses) and in 1988 (for giving a relative $25,000 via a brokerage account). Regulators also filed a complaint against him in 1994.