The Securities and Exchange Commission has charged a San Francisco-area investment advisor with fraud for allegedly lying to clients about how brokerage commission rebates were being used and then providing phony documents to cover up the so-called “soft-dollars” scam during an SEC examination.

In its complaint, the SEC claims Kurt Hovan, the principal at Hovan Capital Management in upscale Belvedere, Calif., misappropriated more than $178,000 in soft dollars that he falsely said were being used to pay for legitimate investment research on his clients’ behalf.

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