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Former Alabama Financial Advisor Barred After Selling His Practice

Posted on July 31st, 2026 at 4:59 PM
Former Alabama Financial Advisor Barred After Selling His Practice

From the desk of Jim Eccleston at Ä¢¹½´«Ã½

The U.S. District Court for the Middle District of Alabama has entered a final judgment against James Blake Daughtry, granting the SEC's request to permanently enjoin him from violating the Investment Advisers Act and to prohibit him from associating with any broker, dealer, or investment adviser, AdvisorHub reports.

The SEC alleged that Daughtry breached his fiduciary duties when he sold his advisory practice in 2019 to Jared D. Eakes, founder of the now-defunct GraySail Advisors. As AdvisorHub reports, the SEC filed its original complaint against both individuals in 2022. The court later transferred the claims against Daughtry to the Middle District of Alabama in February 2024.

According to the SEC's complaint, Eakes misappropriated approximately $2.6 million from GraySail clients, including several former clients of Daughtry. The SEC alleged that Eakes assured clients he would continue monitoring their accounts and reviewing investment recommendations after the transition but failed to do so, even after clients raised concerns about activity in their accounts.

The SEC further alleged that Eakes diverted client assets to fund unprofitable trading in his personal brokerage accounts, repay business and student loans, and make a $116,000 payment to a Las Vegas casino, according to AdvisorHub.

The SEC also alleged that Daughtry failed to notify Kestra Investment Services about the sale of his advisory practice. AdvisorHub reports that Daughtry spent the final five years of his more than two-decade brokerage career with the firm before his termination.

According to BrokerCheck, Kestra terminated Daughtry's employment, and FINRA permanently barred him in March 2020 after he refused to provide testimony during a FINRA Rule 8210 investigation into potentially fraudulent and unauthorized transactions in customer accounts.

Ä¢¹½´«Ã½ LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.

Tags: eccleston, eccleston law, securities law, finra enforcement, financial advisor barred, sec compliance, broker-dealer regulation

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