SEC v. Chadd L. Evans (free riding and parking, 2023)

Settled

✓ Checked against the primary document on October 3, 2026. The library's summary, tags and figures for this record were compared with the regulator's own document by an AI model (Claude) following written instructions, with sampled and disputed records read a second time. No lawyer has reviewed them. A checked record can still contain errors, and checked does not mean endorsed. See how we check records or report a correction.

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In July 2023 the SEC charged Virginia man Chadd Evans with a free-riding scheme using bogus transfers from under-funded accounts at five brokerages, with over $280,000 of false deposits and nearly $1 million in trades. He consented to an injunction, an account-opening restriction and a $10,000 penalty, subject to court approval.

The record

What was ordered

Civil penalty

$10k

Disgorgement

—

Prejudgment interest

—

Total relief

$10k

Alleged gain

—

A dash means the release did not state a figure we could extract, not that the figure is zero. Penalty and disgorgement are stored separately so aggregates across the library do not double-count the same dollars.

What is alleged to have happened

The Securities and Exchange Commission announced on July 19, 2023 (litigation release 25782) a complaint in the Western District of Virginia.

The SEC alleged that from July to October 2020 Evans made bogus transfers from under-funded bank and brokerage accounts to new accounts at other firms, knowing he lacked the money, and traded using funds the brokers made temporarily available while the transfers were pending. He allegedly did this at five brokerage firms, with false deposits over $280,000 and nearly $1 million in trades, leaving the brokers with losses.

Without admitting or denying, Evans consented to a final judgment, subject to court approval, enjoining him from violating Section 10(b) and Rule 10b-5, barring him from opening a brokerage account without giving the firm the complaint and judgment, and requiring a $10,000 civil penalty. This library tags the matter as free riding. The record showed the status as judgment, which was still subject to approval.

For the regulator's own account of the facts, read the primary document linked above. This page deliberately summarises the structured record rather than reproducing the release.

What technique is this, and how does it work?

This action is tagged with one technique in our taxonomy. The tagging is ours: regulators charge statutory provisions, not technique names, so the mapping is an editorial judgement described in our editorial policy.

• Free riding and parking — see how it works, what statute it engages, and every other action tagged the same way.

Timeline

1. 2023-07-19 Litigation release published

Primary documents

Everything on this page derives from the documents below. Where our summary and the primary document disagree, the primary document is right.

• SEC litigation release

The linked release is a work of the United States government and is not subject to copyright. Our summary and narrative above are our own writing.

Related actions

Other actions in the library sharing at least one technique tag with this one.

Record added September 10, 2026. submit a correction.