The SEC said Thursday that a New York lawyer allowed his law firm’s bank account to be used in an $8.4 million investment scheme.
In a civil case filed in Dallas federal court, the SEC accused Kenneth Miller and his small law company, Frost & Miller, of helping Dallas-based Aaron McKnight defraud investors by enabling McKnight to transfer the business’s bank accounts more than $2 million.
The SEC stated McKnight operated several schemes, including one in which he promised a trading platform to combine participants’ assets to make multimillion-dollar bets, offering returns of 40% to 100% each month for 10 to 12 months.
Yet the trading program did not exist, the SEC claimed. Instead, according to the SEC, McKnight used part of the money to buy a property and finance a jazz club he partially owned.
McKnight and Miller were unavailable for comment.
The complaint claims Miller and his business did not examine the transactions. Instead, the SEC said Miller “blindly” followed McKnight.
According to LinkedIn, Miller, 72, advises organizations on corporate, finance, M&A, and securities concerns.
Miller and his legal practice “knowingly infused McKnight’s fraud with an aura of respectability and offered investors a false sense of security, so advancing McKnight’s deceit,” the SEC said.
Miller’s company partner, Gregory Frost, was not charged. He did not comment.
Frost & Miller sued McKnight in 2021 after an investor threatened to sue. McKnight and the other defendants in that Manhattan federal court case never appeared.
Securities and Exchange Commission v. Aaron Cain McKnight et al., 3:23-cv-00641, U.S. District Court for the Northern District of Texas.
