Massachusetts Secretary of the Commonwealth William Galvin charged Cantella Securities of Boston Wednesday with improperly selling a hedge fund to non-accredited investors, who each lost about $100,000 apiece. Registered reps James Pangione and Timothy Rassias were charged with the improper sales, as well as wiping out 90% of the assets in two hedge funds by investing the money in tech.

Approximately 41 clients invested a total of $3.5 million in the two funds, the Hercules Hedgehog Fund and the Agrippa Fund, according to the regulator. More than half of these investors were "unsophisticated, non-accredited investors," according to the complaint.

Subscribe Now

Access to premium content including in-depth coverage of mutual funds, hedge funds, 401(K)s, 529 plans, and more.

3-Week Free Trial

Insight and analysis into the management, marketing, operations and technology of the asset management industry.