U.S. Securities and Exchange Commission Litigation Release No. 26339, dated July 3, 2025.
The SEC charged an investment adviser, P/E Capital, and its CEO, Eliseo Prisno, for defrauding clients. They allegedly charged over $2.4 million in unauthorized and undisclosed fees between February 2019 and July 2023. The scheme involved using client login credentials without consent to bypass authorization requirements.
In Plain English
Imagine you hired someone to manage your piggy bank. They were supposed to take a small, agreed-upon snack fee for their work. Instead, they secretly took extra snacks from your piggy bank without telling you, sometimes even using your secret handshake to open it when you weren't looking. The SEC says this is what Eliseo Prisno and his company P/E Capital did with their clients' money, taking millions in extra fees they never agreed to.
Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.
How the Alleged Scheme Worked
- Establish Advisory Relationships Eliseo Prisno and his company, P/E Capital, acted as investment advisers, entering into agreements with clients to manage their money. They owed these clients a fiduciary duty, meaning they were legally obligated to act in their clients' best interests.
- Disclose Standard Fees P/E Capital disclosed its standard fees in its Form ADV Part 2A Brochure. Clients were informed that fees would be annual, based on a percentage of assets under management (e.g., 2% or 2.4%), and that no performance-based fees were charged. Fees were billed in arrears.
- Introduce Undisclosed Fees Beginning at least in February 2019, Prisno and P/E Capital began charging clients additional fees that were not disclosed in their Brochures. These were described as 'unauthorized and undisclosed quarterly fees' on top of the disclosed annual advisory fees.
- Circumvent Authorization Requirements To charge these unauthorized fees, Defendants allegedly used their clients' login credentials for brokerage accounts without consent. This allowed them to bypass the brokerage firm's requirement that clients directly authorize any additional fees.
- Deceptively Authorize Fees In some instances, the complaint alleges, Prisno and P/E Capital would use the client's login credentials and then route multi-factor authentication texts to phone numbers under their own control, effectively authorizing the fees themselves without client knowledge or consent.
- Charge Over $2.4 Million Through this scheme and other deceptions, Defendants cumulatively charged over 220 advisory client accounts approximately $2.4 million in unauthorized and undisclosed quarterly fees during the Relevant Period (February 2019 to July 2023).
- Benefit Personally The SEC's complaint alleges that Eliseo Prisno was personally enriched by charging these improper fees, indicating that the funds were not merely administrative errors but a deliberate scheme for personal gain.
The Enforcement Action
On July 3, 2025, the SEC charged Chicago-based investment adviser P/E Capital Investment Management Partners and its CEO, Eliseo Prisno, with fraudulent billing practices. The SEC's complaint alleges that from at least February 2019 through at least July 2023, Prisno and P/E Capital charged over $2.4 million in unauthorized and undisclosed fees to its clients. The complaint states that in some instances, Prisno and P/E Capital used clients' login credentials without consent to bypass brokerage firm authorization requirements. The SEC's complaint, filed in federal district court in Chicago, charges Prisno and P/E Capital with violating antifraud provisions of the Advisers Act. The SEC seeks permanent injunctions, disgorgement with prejudgment interest, and civil penalties against both defendants, and a conduct-based injunction against Prisno.