SEC Charges Chicago Adviser With Defrauding 28 Investors of $3.6 Million

The U.S. Securities and Exchange Commission filed a civil complaint June 5 against an unregistered Chicago-area investment adviser and two affiliated entities, alleging they raised approximately $4 million from 28 investors while fabricating account statements, inflating net asset values with assets the fund never owned, and diverting at least $1.8 million to personal accounts.

The defendants – John Sterling Myers, age 41; Sterling Capital LLC, and Sterling Capital Management LLC – operated a pooled vehicle called Sterling Capital Investments LLC beginning in 2022, soliciting capital from family, friends, and other investors across approximately five states. None of the three has ever been registered with the SEC as an investment adviser. As of year-end 2025, the fund had repaid investors approximately $398,000, leaving more than $3.6 million unaccounted for, according to the complaint filed in the U.S. District Court for the Northern District of Illinois.

Myers marketed the fund as a “premier” and “exclusive investment pool,” citing prior experience as an investment banker and representing that the fund had consistently outperformed the S&P 500. In a marketing brochure dated December 2023, Myers represented that the fund had outperformed the index in 12 of 15 months since inception, with annual returns of 33.9% in 2022 and 35.7% in 2023. The complaint alleges those representations were false.

The SEC alleges Myers sent investors fabricated quarterly account statements showing individual annual gains ranging from 16% to 54%, based on a fictitious fund net asset value he manipulated through his own spreadsheets. Among the assets Myers included in NAV calculations: his father-in-law’s personal retirement accounts, primary residence, and an adjacent parcel of land – none of which the fund owned or had any claim to, according to the complaint. Collectively, those items were valued at approximately $1.2 million in Myers’ quarterly NAV calculations.

After a significant portion of the father-in-law’s retirement account was lost through options trading in April 2024, Myers added another line item to inflate the NAV: a $1 million-plus valuation of Sterling Capital itself, calculated as the present value of Myers’ self-estimated earning potential of $250,000 per year for 40 years. Myers had earned no income for years at the time, according to his own tax returns cited in the complaint.

On April 16, 2024, an investor wired $50,000 to a Sterling Capital bank account holding $24.34. The next day, Myers transferred $40,000 to a personal brokerage account and lost it in trading; the remaining $9,500 went to repay a different investor. The pattern repeated in June 2024, when a $100,000 investor contribution arrived in a Sterling Capital account holding $25.71; Myers transferred $90,000 to his personal brokerage account and lost nearly all of it within days.

Sterling Capital’s only brokerage account was closed by the brokerage firm in or around March 2024 due to a pattern of third-party deposits, trading losses, and withdrawals. Myers subsequently routed investor funds through his personal accounts. His own tax returns, filed jointly with his wife, reported more than $890,000 in deductible trading losses in 2023 and more than $1 million in 2024.

When investors requested redemptions in spring 2025 totaling approximately $560,000, Myers told them the fund’s assets had been frozen due to the SEC’s investigation – a claim the complaint characterizes as false. The fund did not have the assets to meet the withdrawals.

The commission is seeking permanent injunctions, disgorgement of ill-gotten gains with prejudgment interest, civil monetary penalties, a bar preventing Myers from acting as or associating with any investment adviser, and a bar on his participation in the issuance, purchase, offer, or sale of any security, with an exception for trading in his personal account.

The complaint alleges violations of the antifraud provisions of the Securities Exchange Act of 1934, the Securities Act of 1933, and the Investment Advisers Act of 1940.

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