7.2.2008 The SEC charged John H. Lohmeier, Enterprise Trust Company and Rebecca A. Townsend with fraudulently inducing hundreds of customers of Advisory Financial Consultants (AFC), a registered broker-dealer, to transfer custody of approximately $49 million in mutual funds to Enterprise. The SEC further alleged that unbeknownst to and without the authorization of the customers, Lohmeier, Enterprise, and Townsend placed the AFC customers' mutual funds into margin and other accounts where the AFC customers' securities served as collateral for leveraged margin trading, including options trading and short selling, that was intended to benefit Enterprise's principals, Lohmeier and Townsend, and other Enterprise customers. This margin trading was not intended to and did not benefit the AFC customers. The SEC stated that on February 13, 2008, more that $8 million of the AFC customers' mutual funds were sold without the AFC customers' knowledge or approval to cover Enterprise's margin debt.
Click http://www.sec.gov/litigation/litreleases/2008/lr20635.htm for a copy of the administrative order