Carole A. Liston built her investment pitch around a simple proposition that was difficult to ignore. Give her money, let her apply a supposedly proprietary trading strategy, and investors could earn returns far beyond what traditional markets normally offer. The Securities and Exchange Commission says that promise helped her and two Florida companies collect approximately $5.7 million from more than 200 investors between August 2020 and July 2024. What investors were shown as trading success, however, was far removed from what was happening inside the brokerage account.
The person at the center of the case is Carole A. Liston, a New York resident who was 61 when the SEC formally documented its findings in March 2026. During the period examined by regulators, she was the founder and chief executive of Stock Purse Trading LLC and the chief executive of Liston Associates Inc. She controlled the companies’ bank and brokerage accounts and the key aspects of their operations. The SEC’s records say she had never been registered with the Commission and had no previous disciplinary history.
The businesses operated through a Florida corporate structure. Stock Purse Trading was formed in March 2022 with a principal place of business in Palm Beach Gardens, while Liston Associates was formed in January 2022 and was described as an IT-services business. Neither had been registered with the SEC. Both were administratively dissolved in September 2024, according to the SEC’s complaint. Florida corporate records also show another entity, Stock Purse Investments LLC, incorporated in August 2021 and later administratively dissolved.
The chronology matters because Liston’s solicitation of investors began before Stock Purse Trading formally existed. The SEC says Liston began seeking investors in at least August 2020, initially on her own and later through the Stock Purse structure. She presented herself as someone with a background in computer programming and technical development and claimed to have created a proprietary algorithm for short selling stocks. She told prospective investors that the system could perform particularly well during market volatility.
The promises were extraordinary. According to the SEC complaint, Liston promoted monthly returns of between 5% and 20%, said investors could double their money in 30 to 60 days and claimed the strategy could produce profits of 350% in a year. Investors were offered three programs, called the Growth Fund, Income Fund and Family Fund. The Growth Fund and Income Fund were represented as producing monthly returns of as much as 15%, while the Family Fund carried a promise to double an investor’s money within six months.
The pitch was delivered through personal networks as much as conventional marketing. The SEC says investors were recruited through friends, family and word-of-mouth connections, including real-estate networks, multi-level-marketing seminars and a church. Some investors put in only several thousand dollars, while others committed hundreds of thousands. They were instructed to complete forms through Stock Purse Trading’s website and then wire money according to instructions provided by the companies.
One detail in the SEC complaint illustrates how informal the operation could become. Early in the relevant period, Liston directed investors to wire money to her personal bank account. In at least one instance, the SEC says she instructed an investor to characterize the transfer as a “loan” so that it would not be flagged by the bank. That allegation is significant because the investment proposition being sold to customers was presented as a structured trading operation, not a personal borrowing arrangement.
The SEC’s examination of the underlying brokerage records produced a stark contrast between the sales pitch and the actual trading activity. Liston raised about $5.7 million, but less than $1.7 million was placed into the brokerage account for trading. The trading itself did not generate the spectacular profits promised to investors. Instead, the SEC says the account suffered net losses of more than $230,000 from options trading and short sales.
The most striking evidence involved investor account statements. According to the complaint, an online account summary dated January 3, 2023 showed one investor had put in $395,000 and supposedly had a balance of $981,000, representing a 148% gain. Yet brokerage records for December 2022 and January 2023 showed the entire Stock Purse brokerage balances totaled less than $2,000. The SEC says the displayed balance was fictitious and that similar false account information remained available for more than a year.
The regulator also alleges that investors were not told about the extent of the risk being taken with their money. Liston used margin trading, a technique involving borrowed money that can magnify losses, while the company’s website did not clearly explain that margin referred to leverage in its trading strategy. Investors were first notified of the use of margin in the summer of 2023, after the companies failed to return principal to investors and posted a notice referring to a brokerage account deficit.
Behind the promised trading profits, the SEC says, was a flow of money that increasingly depended on investor deposits. At least $3.9 million was used to make what the agency described as “Ponzi-like” distributions to investors. In other words, because the trading operation was not producing enough money to satisfy promised returns and withdrawal requests, funds from newer investors were allegedly used to make payments to existing investors. The SEC says more than $450,000 was also diverted for Liston’s personal benefit, including real-estate purchases, cars, hotels, clothing, luxury gifts, credit-card expenses and a cruise.
The allegations resulted in a federal securities case filed in the Southern District of Florida in August 2025. The SEC charged Liston and the companies under the anti-fraud provisions of the Securities Act and Exchange Act, including Section 10(b) and Rule 10b-5. Liston was also charged under Sections 206(1) and 206(2) of the Investment Advisers Act, reflecting the SEC’s position that she was functioning as an investment adviser while exercising control over client money and securities decisions.
The case did not proceed to a trial on the merits. Liston and the companies agreed to judgments permanently enjoining them from future violations, without admitting or denying the allegations. Court records show judgments were entered against all three defendants in September 2025. The case was later reopened briefly so the SEC could pursue monetary relief and was subsequently resolved through the settlement process.
By May 2026, the financial consequences had become clearer. Bloomberg Law reported that Liston and the companies agreed to pay roughly $790,000 in disgorgement, prejudgment interest and civil penalties. The settlement called for about $420,000 in disgorgement, nearly $134,000 in prejudgment interest and a $236,451 civil penalty against Liston.
A separate SEC administrative order issued in March 2026 added another important consequence. Liston was barred from associating with brokers, dealers, investment advisers, municipal securities dealers, municipal advisers, transfer agents and nationally recognized statistical rating organizations. The order states that she accepted the settlement without admitting or denying the findings, apart from jurisdictional matters and specified findings she admitted.
That distinction is important. This was a civil enforcement case, not a criminal conviction. The available records do not establish that Liston pleaded guilty to a crime or was criminally convicted. Instead, the SEC obtained permanent injunctions, monetary sanctions and an industry bar through civil and administrative proceedings. The original allegations should therefore be distinguished from facts established through the judgments and settlement orders.
As of the latest reliable public regulatory record reviewed for this article, Liston remains identified as a Yonkers, New York resident. There is no credible public reporting showing that she has resumed a regulated investment-advisory business, and the SEC’s March 2026 order prevents her from associating with the specified financial-industry entities unless she successfully obtains reentry under the applicable process. Public corporate records continue to show Liston Associates as active in one database, but that status should not be confused with evidence that the company is currently conducting an investment business.
There is also no credible evidence uncovered in the reviewed sources establishing a wider criminal network, named co-defendants, or a separate criminal prosecution involving family members or promoters. The SEC case names Liston, Stock Purse Trading and Liston Associates as defendants. Florida records do show Colleen Stewart as a managing partner of the separate Stock Purse Investments LLC, but the SEC’s federal case does not accuse Stewart of participating in the alleged investor fraud.
What makes the Liston case worth attention is not simply the size of the $5.7 million raise. It is the mechanism. The operation allegedly combined spectacular return promises, personal referrals, technology-heavy language about algorithms, online account dashboards and the appearance of regular investor payouts. Yet regulators say the underlying trading account was losing money, most of the money raised was not being traded, and millions of dollars were being recycled to satisfy investors. That is precisely the kind of structure that can make an investment operation appear healthier from the outside as it becomes weaker underneath.
The case is also a reminder that sophistication is easy to imitate. A proprietary algorithm, a professional-looking website and impressive account figures can create the appearance of a functioning investment business without proving that the underlying assets exist or that the returns are real. In Liston’s case, the SEC says the gap between the figures investors saw online and the brokerage records was enormous. For investors, that gap was the difference between an account that appeared to contain nearly $1 million and a brokerage account containing less than $2,000.
The final lesson is uncomfortable but straightforward. High returns do not become credible simply because they are wrapped in technical language, personal assurances or a convincing online portal. The Liston case shows why investors need to verify who controls their money, whether an adviser is registered, where assets are actually held and whether claimed returns can be independently verified. The SEC’s action cannot undo every loss suffered by investors, and the roughly $790,000 settlement is only a fraction of the $5.7 million raised. But the record leaves a clear warning for anyone tempted by extraordinary returns: the most convincing investment story is still worthless if the money underneath it is not where investors were told it was.
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