Investor Lawyers Blog
Securities fraud attorneys are currently investigating claims on behalf of Wells Fargo Advisors LLC customers in light of a recent arbitration award regarding the firm’s alleged failure to detect theft and fraudulent transactions in a customer’s account. On July 3, 2013, a Financial Industry Regulatory Authority arbitration panel ordered Wells Fargo to pay an investor $2.8 million for the alleged failures.
The case was filed by a family limited partnership, College Health and Investment Ltd., in 2010. According to stock fraud lawyers, many wealthy families use family limited partnerships as an estate planning tool to minimize certain tax liabilities and preserve assets.
Reportedly, College Health filed a lawsuit in 2010 against Esther Spero. Spero allegedly forged the signatures of the family limited partnership’s employees who had authorization to transfer funds so that she could make transfers out of the accounts for her personal use. A $21 million judgement was entered in October, 2010, against Spero. Allegedly, Spero operated the scheme through multiple entities, including Wells Fargo.
Reportedly, the unauthorized transactions and theft occurred between 2006 and early 2008. The $2.8 million FINRA award includes damages of $2.3 million and interest. In addition, Wells Fargo must pay margin interest of $419,000 and costs totaling $35,000.
According to securities fraud attorneys, firms have a responsibility to properly supervise and monitor customer accounts for fraud and theft. If they fail to do so, they may be held liable for customer losses. Investors should carefully review their account statements for unauthorized transactions and other signs of fraud and theft.
If you are a customer of Wells Fargo or another full service brokerage firm and have reason to believe that fraudulent or unauthorized transactions have caused you significant losses, you may have a valid securities arbitration claim. To find out more about your legal rights and options, contact a stock fraud lawyer at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 for a no-cost, confidential consultation.