U.S. Securities and Exchange Commission Litigation Release No. 26519, dated April 2, 2026.
The SEC charged the estate of John R. Brodacki, III and his company, Castle Hill Financial Group, LLC, for allegedly defrauding at least 18 clients out of approximately $1.68 million. Brodacki and Castle Hill are accused of misappropriating client funds, which were intended for investments, to pay for personal and business expenses, including lavish meals and club memberships.
In Plain English
Imagine you give your piggy bank money to a trusted friend to invest for you. Instead of investing it, this friend takes the money to buy fancy dinners, pay for their club memberships, and even give it to their family. That's what the SEC says happened here: an investment adviser and his company took money from clients, many of whom were elderly or ill, promising to invest it, but instead used it for their own personal spending.
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
- Clients Entrusted Funds for Investment John R. Brodacki, III, and his company Castle Hill Financial Group, LLC, acted as investment advisers. They convinced at least 18 clients, many of whom were elderly, retired, or seriously ill, to transfer their money to Castle Hill for investment purposes.
- Promises of Investment Growth Brodacki allegedly told these clients that their funds would be used to make investments that would benefit them or their relatives. This created an expectation of growth and security for their savings.
- Misappropriation Instead of Investment Instead of investing the money as promised, Brodacki and Castle Hill allegedly used the clients' funds for their own purposes. This included paying Brodacki's personal and business expenses.
- Lavish Personal Spending The misappropriated funds were allegedly used to pay for a variety of personal expenses, including 'lavish meals,' membership fees to 'exclusive social clubs,' tuition for Brodacki's family members, and travel.
- Ponzi-like Repayments Some of the clients' money was also used to make payments to other advisory clients, and to Brodacki's own family members. This suggests a potential Ponzi-like structure where new client money was used to pay off older clients or family.
- Fabricated Account Statements To conceal the fraud, Brodacki and Castle Hill allegedly provided some clients with 'fabricated account statements.' These fake statements showed purported investment values, misleading clients about the status of their funds.
- Continued Solicitation Despite Termination The scheme persisted even after the registered investment adviser with which Brodacki and Castle Hill were associated terminated their relationship in July 2025. They allegedly continued to solicit and accept client funds for purported investment advisory services.
- Total Misappropriation After accounting for approximately $162,750 in partial repayments made to some clients, the SEC estimates that Brodacki and Castle Hill misappropriated approximately $1.68 million from their targeted advisory clients.
The Enforcement Action
On April 2, 2026, the SEC charged the estate of John R. Brodacki, III, and his company, Castle Hill Financial Group, LLC, in the U.S. District Court for the District of Massachusetts. The SEC alleges that Brodacki and Castle Hill breached their fiduciary duties and misappropriated approximately $1.68 million in client funds between June 2018 and September 2025. The SEC seeks disgorgement with prejudgment interest from Brodacki's estate and Castle Hill, and a civil money penalty and permanent injunction against Castle Hill.