A federal lawsuit alleges that an Ohio-based financial advisor secretly steered client assets into a medical weight-loss clinic he controlled. The advisor reportedly executed dozens of discretionary trades without disclosing his personal stake in the venture. Haselkorn & Thibaut, P.A., operating as Investment Fraud Lawyers, has experience representing investors harmed by undisclosed outside business activities and advisor conflicts of interest. When an advisor places personal gain ahead of client interests, the financial damage can be significant.
What the lawsuit alleges
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The complaint was filed in the U.S. District Court for the Southern District of Ohio as *Jenkins et al v. Sweeney et al* (Case No. 2:26-cv-00997). It accuses financial advisor Sweeney and his advisory entities of using discretionary authority over client accounts to fund a side business called Thrive Venture, a medical weight-loss clinic.
The Financial Industry Regulatory Authority, or FINRA, generally requires advisors to disclose outside business activities and conflicts of interest to both clients and their firms. The Securities and Exchange Commission (SEC) imposes similar disclosure obligations on registered investment advisers.
According to the complaint, Sweeney held discretionary authority over plaintiff Matt Jenkins’ investment accounts. Beginning in early 2025, Sweeney allegedly solicited Jenkins to invest in Thrive Venture without revealing that Sweeney himself held a majority ownership interest in the clinic. The plaintiffs allege that Sweeney failed to disclose this conflict to Jenkins and to his own broker-dealer and RIA firms.
How client funds were allegedly redirected
The complaint details a series of discretionary transactions that moved money from Jenkins’ advisory accounts into the Thrive Venture investment. Discretionary authority allows an advisor to buy or sell securities in a client’s account without prior approval for each trade. The plaintiffs allege Sweeney abused that authority to liquidate holdings and redirect proceeds toward his own business interest.
| Date | Transaction | Amount |
|---|---|---|
| August 15, 2025 | Discretionary sale of Federated Hermes Prime Cash Obligations (PCOXX), account 5750A724 | $17,000 |
| August 20–21, 2025 | Disbursements from account 5750A724 to plaintiffs’ bank | $17,000 and $12,000 |
| August 29, 2025 | Full liquidation of PCOXX position and sale of 72 SPDR Gold Shares at $317.3906/share, account 5750A724 | $184,505.34 (PCOXX) + $22,852.12 (GLD) |
| Third quarter 2025 | 312 discretionary trades restructuring account 4142F388 into a direct-indexing strategy | Various positions |
| October 24, 2025 | 67 discretionary sales in account 4142F388 in a single day | Various positions |
| October 27, 2025 | Journal transfer from account 4142F388 to account 5750A724 | $98,000 |
| October 31 – November 1, 2025 | ACH disbursements from account 5750A724 to Jenkins’ bank | $98,000 |
| November 17, 2025 | Check from Jenkins’ bank deposited into Thrive Venture bank account controlled by Sweeney | $98,000 |
On October 23, 2025, Jenkins acquired a 49% membership interest in Thrive Venture for $98,000, while Sweeney acquired a 51% membership interest for $104,000. An LLC membership interest is an ownership stake in a limited liability company, and the complaint alleges this interest qualifies as a “security” under Ohio law (Revised Code Chapter 1707).
Alleged misrepresentations and subsequent events
The complaint further alleges that Sweeney supplied revenue forecasts, third-party earnings anecdotes, and financial projections to Jenkins. Sweeney allegedly prepared the venture structure and directed the funding mechanics through advisory accounts he controlled.
| Date | Event | Details |
|---|---|---|
| October 23, 2025 | Jenkins acquires 49% LLC interest; Sweeney acquires 51% interest | Jenkins: $98,000; Sweeney: $104,000 |
| January 10, 2026 | Sweeney informs Jenkins that Thrive Venture has approximately four months of cash remaining | Assuming no income |
| April 2, 2026 (2:14 a.m.) | Sweeney demands Jenkins pay $80,000 to buy out Sweeney’s interest, allegedly claiming the business was “in a great place now” | $80,000 demand |
| April 7, 2026 | Sweeney emails landlord to discuss lease buyout, disclosing Jenkins’ confidential financial condition | Sweeney personally guaranteed the clinic’s five-year lease |
| April 6 and 9, 2026 | 191 discretionary sales executed in account 4142F388 (45 on April 6; 146 on April 9) | ~$238,092 principal; ~$27,890.37 short-term capital gains |
Plaintiffs terminated the advisory relationship in writing on April 9, 2026, at 8:00 a.m. That same day, 146 discretionary sales were reportedly executed in the restructured account. Combined with 45 sales on April 6, these 191 transactions generated approximately $238,092 in principal and $27,890.37 in short-term capital gains.
Legal claims and investor protections
The complaint asserts multiple causes of action. These include violation of Ohio securities law (R.C. Chapter 1707), breach of fiduciary duty, fraudulent concealment of a conflict of interest, and unauthorized or discretionary misuse of client assets. These claims center on the allegation that Sweeney placed his own financial interest in Thrive Venture above his obligation to act in Jenkins’ best interest.
Investors who suspect their advisor may have an undisclosed financial advisor conflict of interest should request a full account statement review. Compare disclosed holdings against trade confirmations. Warning signs include a high volume of discretionary trades, sudden shifts in investment strategy, and investments in ventures connected to the advisor.
What investors should do
If you suspect your advisor placed your assets into investments tied to an undisclosed outside business interest, consider these steps:
– Request complete account records and trade confirmations from your brokerage firm.
– Review all discretionary trades for strategy changes you did not authorize.
– Ask your advisor directly about any business interests connected to your investments.
– Consult a securities attorney experienced in securities fraud and fiduciary duty claims.
How our firm can help
Our attorneys include former Wall Street defense counsel who understand how advisory firms operate — and where they fail to protect clients. We represent investors nationwide in claims involving undisclosed outside business activities, unauthorized trading, and breach of fiduciary duty.
We operate on a contingency-fee basis: no recovery, no fee. Contact us at 1-888-885-7162 or visit InvestmentFraudLawyers.com for a free consultation.
Frequently asked questions
What is a financial advisor conflict of interest?
A financial advisor conflict of interest arises when an advisor has a personal financial stake in an investment they recommend or manage. Federal and state regulations generally require advisors to disclose such interests so clients can make informed decisions.
What is discretionary authority in an investment account?
Discretionary authority allows a financial advisor to buy or sell securities in a client’s account without obtaining prior approval for each transaction. While this can be convenient, it also creates risk if the advisor uses that authority to advance personal interests rather than the client’s goals.
Is an LLC membership interest considered a security?
Under Ohio law (R.C. Chapter 1707), an LLC membership interest can qualify as a security if it meets certain criteria, including the expectation of profits derived from the efforts of others. The complaint in this case alleges that the Thrive Venture membership interest sold to Jenkins qualifies as a security under that statute.
What should I do if my advisor invested my funds in a business they control?
Request a complete record of all trades and account statements. Compare discretionary transactions against your investment objectives. Contact a securities attorney to evaluate whether the advisor disclosed the conflict and whether your losses may be recoverable through arbitration or litigation.
Past results do not guarantee future outcomes. This page provides general information and is not legal advice. No attorney-client relationship is formed by reading this content.
There is no assured recovery in any securities matter. Consult a qualified attorney regarding your specific situation.
