Local investment adviser facing lawsuit over soured business deal

An Indianapolis-area investment advisory firm owner who is already facing complaints from the Securities and Exchange Commission and numerous clients now faces a lawsuit over a business deal gone bad.

Tamara “Tammie” Steele of Indianapolis, the owner of Pendleton-based Steele Financial Inc., is named as a defendant in a case filed by Casey Kemerly, former owner and president of Pendleton-based Kemerly Services LLC.

Other defendants are Noblesville-based Evia Investment Advisors LLC and the firm’s president, Daniel P. Reichart.

The suit, filed Wednesday in Madison County circuit court, alleges that Steele sold her firm’s assets to Kemerly, including client accounts, but later defamed Kemerly to those clients, persuading some of them to move their investments to Reichart’s firm.

The situation traces back to the SEC and client complaints against Steele, which resulted in her removal from the TD Ameritrade trading platform, the suit alleges.

The SEC complaint, filed in September, alleges that Steele violated federal law by selling $13 million in high-risk securities to more than 120 clients without disclosing that the firm stood to receive commissions of up to 18 percent from those sales. That case is still pending.

Since 2017, a dozen clients have filed complaints against Steele with the Financial Industry Regulatory Authority, alleging that Steele recommended investments that were not suitable for them. Of those complaints, six are still pending and six have been settled for amounts ranging from $44,500 to $1.18 million.

Facing the loss of access to TD Ameritrade effective Jan. 1, Kemerly’s suit says, Steele agreed to sell her firm’s assets to Kemerly, including customer accounts and the right to receive advisory fees from these accounts. In exchange for the assets, Kemerly agreed to pay Steele 50 percent of gross revenues for the next 20 years.

The transition of assets was complete in January, and Kemerly paid Steele $73,633 on April 14, the suit says.

After receiving that payment, Steele “began to once again unlawfully operate as if she was still a registered investment adviser and/or broker-dealer,” the suit alleges. 

Steele “failed and refused to recognize that Kemerly was the owner of her former customer accounts” and began to demand that Kemerly not communicate with those clients, the suit alleges. 

Steele also “falsely and maliciously told her former clients that Kemerly stole their accounts and committed crimes,” the suit alleges, and, as a result of Steele’s actions, police offers were dispatched to Kemerly’s firm on May 14.

In a newsletter to her former clients, Steele announced that she had formed a new business relationship with Reichart of Evia Investment Advisors. 

At Steele’s direction, the suit says, clients moved more than $12 million in assets—about 130 separate accounts—from Kemerly, and most of those ended up at Evia, where Steele continues to provide investment advice.

Kemerly alleges that he lost an estimated $225,000 in annual revenue as a result of Steele’s actions, in addition to suffering damage to his reputation.

He is asking that the defendants pay him compensatory and punitive damages in unspecified amounts, as well as attorney fees and court costs. Kemerly also is asking for a court order prohibiting the defendants from both continuing to defame Kemerly and from contacting the clients whose accounts he purchased from Steele.

Steele did not return a phone message and email sent to her firm Thursday afternoon, and court records do not indicate who her legal counsel is in this case.


Please enable JavaScript to view this content.

Story Continues Below

Editor's note: You can comment on IBJ stories by signing in to your IBJ account. If you have not registered, please sign up for a free account now. Please note our updated comment policy that will govern how comments are moderated.

{{ articles_remaining }}
Free {{ article_text }} Remaining
{{ articles_remaining }}
Free {{ article_text }} Remaining Article limit resets on
{{ count_down }}