The Securities and Exchange Commission today charged former investment adviser Yellowstone Partners, LLP, of Idaho Falls, and its two former principals, David H. Hansen and Cameron G. High, for fraudulently overbilling clients and charging fees for work not performed.

The SEC's complaint alleges that from at least 2008, Yellowstone, through Hansen and High, systematically overbilled more than 100 of its client accounts for a total amount of over $11.8 million. According to the complaint, the overcharges were used to cover operating expenses and to support Hansen's lavish lifestyle. As alleged, Yellowstone also failed to maintain certain required books and records.

The SEC's complaint, filed in federal district court in Pocatello, Idaho, charges the defendants with violating the antifraud provisions of Sections 206(1) and (2) of the Investment Advisers Act of 1940 (Advisers Act) and the recordkeeping provisions of Section 204(a) of the Advisers Act and Rules 204-2(a)(10) and 204-2(e)(1) thereunder. The SEC seeks permanent injunctions and monetary relief.

The SEC's investigation was conducted by Cheryl M. Mori and was supervised by Daniel J. Wadley of the Salt Lake Regional Office, with assistance from Peter Bloom, Ada Chee, Edward Haddad, Matthew O'Toole, and Scott Walker of the San Francisco Regional Office exam team. The litigation will be led by Amy J. Oliver and David D. Whipple.