Another sports star is claiming that his advisor wrecked his nest egg, but this time there's a twist. The advisor in question is a certified financial planner.
Denny Neagle, who played for various teams from 1991 to 2005, and his former wife have sued William S. Leavitt, a Chicago CFP practitioner.
They claim that Leavitt "took advantage" of their relative ignorance of the financial markets by placing their money in hedge funds, alternative investments and other relatively illiquid or high-risk vehicles when they asked for a conservative traditional allocation.
Since Neagle was signing $50 million contracts at the peak of his career, there's a lot of money at stake here.
And given Leavitt's CFP status, there's a lot of reputation riding on this case. The CFP Board rarely files a disciplinary action for anything worse than personal bankruptcy.
This time, negligent misrepresentation, unjust enrichment, and breah of fiduciary duty are on the line.
Is this the CFP Board's chance to step up as a de facto regulator for its certificants? Does it want to do so?
Leavitt, notably, is registered with the SEC as an advisory firm with a whopping $300 million in total AUM. Will this go through that regulator's channels instead?