FINRA Arbitration Panel Orders Wells Fargo Advisors To Pay $3.4M To Investor
Broker-Dealer Accused of Negligence That Allegedly Enabled Elder Financial Exploitation
A three-person FINRA Dispute Resolution Services panel awarded one investor $3.4M in damages and costs over losses his now-deceased mother sustained while working with Wells Fargo Advisors and its financial advisor Stephen Lyndell Smith. The claimant, who filed his broker fraud lawsuit in 2023, alleged negligence, breach of contract, breach of fiduciary duty over the broker-dealer’s purported “inaction” to stop unauthorized trades in the account of an older investor in declining health, and more.
Despite having procedures in place to identify warning signs of elder financial exploitation, Wells Fargo Advisors allegedly missed red flags indicating that something was amiss. This included stock transfers at the suggestion of other family members.
When Senior Financial Abuse Leads to Serious Investor Losses
According to FBI data, there was a 14% rise in elder financial exploitation between 2022 and 2023. Yet, this percentage only accounts for the reported incidents and there are many other crimes involving senior financial abuse that go unreported.
Unfortunately, the most common perpetrators of elder financial abuse remain family or trusted friends. However, there are also strangers and unethical financial professionals who have been known to defraud older people and take advantage of their declining health to exploit them financially.
Broker-dealers and their financial advisors are supposed to have systems in place to identify and stop elder financial abuse of their clients. When a failure to do this leads to serious losses for the older person, the financial firm and their registered representative could be held liable.
Representing Older Investors and Their Families Against Brokerage Firms and Investment Advisors
Shepherd Smith Edwards and Kantas Senior Financial Exploitation Loss Attorneys (investorlawyers.com) represent elderly investors who fell victim to senior financial exploitation against broker-dealers who should have prevented this crime from happening or whose own financial advisors committed this type of broker fraud. If you or someone you know has sustained losses because of elder financial abuse, we can help you determine whether you have grounds for a negligence or fraud claim against your broker-dealer.
This type of dispute is usually filed in FINRA arbitration, and you will want to work with seasoned FINRA lawyers who know how to maximize your chances for a full recovery in this type of legal forum.
We understand how serious it can be to lose money at this late stage in life and that the consequences can be life-altering and devastating. When you work with us, you can trust that you will receive seasoned elder financial abuse representation along with personalized attention.
We take this matter so seriously we have even partnered with McCulloch & Miller to provide elder law and estate planning services so that preemptive measures can be taken to protect you and/or your elderly loved one.
Some signs of Financial elder abuse:
- Irregular account activity.
- Someone suddenly took over the power of attorney for the investor.
- Unauthorized transactions or trades.
- Checks are being signed directly into the broker’s account.
- Sudden changes to a will or other financial documents.
- Unexpected transfer of assets to a family member or someone not related to the person.
- Money disappearing from the older investor’s account.
It is also concerning when the older person is suffering from dementia or some other type of serious cognitive issue and they appear to be making financial decisions they lack the capacity for on their own.
Contact Our Senior Financial Exploitation Loss Attorneys Today
Call (800) 259-9010 or fill out this contact form.