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Compliance officer rips off $9M from charitable foundation, SEC alleges

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An advisor stole more than $9 million from a charitable foundation over more than a decade, and also acted as his firm’s compliance officer, according to allegations made in court documents filed by the SEC.

John Rogicki, managing director of Train, Babcock Advisors, siphoned millions of dollars from the non-profit — set up by an elderly woman to donate her estate to education and health care causes — to pay for real estate purchases for his children and support a lavish lifestyle, according to according to the allegations.

Criminal charges were brought against Rogicki by the Manhattan District Attorney in parallel action. He was arrested on Oct. 18, according to court filings.

After befriending the elderly woman before her death, Rogicki was entrusted as executor of her estate and became the charity’s president after her passing in 2001, says the SEC.

He liquidated securities as investment advisor to the charity, and then wired the trading proceeds to the brokerage account of the estate, which he also controlled through Train, Babcock Advisors, before transferring the money to himself, the regulator alleges.

“Rogicki’s fraud and betrayal of his client’s trust were anathema to his legal obligations and responsibilities as an investment advisor,” according to the complaint.

Two hundred such transactions, accounting for over $9 million, were made between 2004 and 2016, SEC says.

Train, Babcock Advisors declined to comment, but their legal counsel says the firm is cooperating with the SEC and other regulatory authorities.

“In addition to betraying the intent and wishes of the client, Mr. Rogicki betrayed the confidence and trust of everyone at [the firm],” legal counsel for Train, Babcock Advisors said in a written statement.

Attorneys for Rogicki did not return requests for comment.

Rogicki worked as an advisor representative with the firm from 1990 until he resigned in January in connection with the proceedings, the SEC says.

Years ago, Rogicki was financial advisor to the elderly woman’s husband, and later recommended a trust and estates lawyer to the woman, says the SEC.

Utilizing that lawyer, he became the executor of her estate in 1998, three years before her passing, according to the complaint. Three years after her death, Rogicki made the first of the fraudulent wire transfers, says the regulator.

Rogicki, 67, lived in New York at the time of the alleged fraud, but had moved to Little Silver, N.J., according to the SEC.

Established in 1959 as an RIA, Train Babcock Advisors focuses on a select client base of 200 families, according to its website.

The firm manages $426 million in client assets, and the majority of the firm’s 558 clients are high-net-worth households, according to the latest Form ADV filed in April.

A former Train Babcock financial advisor pleaded guilty to stealing more than $1.6 million from three separate estates last December, according to the Manhattan district attorney’s office.

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