Photo by Pedro Ribeiro Simos, Creative Commons
In a recent investigation by the Financial Industry Regulatory Authority (FINRA), two brokers were banned from practicing as registered financial advisors when it was discovered that they allegedly stole $300,000 from an elderly widow of diminished mental capacity. The bad brokers, Fernando L. Arevalo and Jimmy E. Caballero, didn’t work for some fly-by-night boiler room outfit either: they worked for JP Morgan Chase Securities, LLC. According to FINRA, ordering their elderly client to liquidate two annuities and deposit the proceeds into a bank account one of the brokers had opened jointly for himself and her, the account was then drawn upon by Arevalo and Caballero. Evidently, they used their client’s savings to write checks to themselves, pay for personal and retail purchases, and pay down car and real estate loans. In the end, JP Morgan Chase Securities reimbursed the elderly client. Other investors who’ve been victimized in this fashion haven’t been so lucky. It pains us to report it, but stories like this are not at all uncommon. Full reimbursement from a brokerage firm, on the other hand, is quite unusual. Usually, recovering losses like this can be an uphill battle, even for the most determined victim.
FINRA issued a statement reaffirming their commitment to protecting elderly investors, who are often targeted by unscrupulous brokers: "One of FINRA's top priorities is to protect senior investors. We will continue to aggressively pursue and rid the industry of brazen brokers who take advantage of vulnerable customers,” said Susan Axelrod, Executive Vice President of Regulatory Operations.
If you or someone you know has been the victim of broker misconduct or investment fraud, please contact us immediately at 1-855-462-3330 for a free consultation.