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Firm Made Up Billion-Dollar Client, SEC Says

PROVIDENCE, R.I. (CN) - Leila Jenkins and her firm, Locke Capital Management, made up a billion-dollar client in order to boost their credibility and attract legitimate investors, the Securities and Exchange Commission claims in Federal Court. Since late 2006, Jenkins allegedly invented so-called "confidential" client accounts, purportedly based in Switzerland, and told the SEC she had more than $1 billion in assets under management.

The SEC claims the assets of her real clients never amounted to more than $165 million, only a fraction of the amount alleged in the phony confidential client accounts.

"This brazen web of lies to investors constituted a serious breach of fiduciary duty," said David Bergers, director of the SEC's Boston Regional Office.

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