An investment advisor previously employed by Wells Fargo, based in Union County, New Jersey, has been handed a three-year and six-month prison sentence for orchestrating a sophisticated financial fraud scheme, resulting in a total loss of $626,478 for five clients. 

Exploitative Financial Advisor Preys on Vulnerable Clients

The 39-year-old defendant manipulated the trust of his victims, taking advantage of their vulnerabilities, with some being elderly, disabled, or grappling with memory loss. He convinced his clients to transfer money from their brokerage accounts to personal accounts, under the guise of making investments on their behalf. 

However, instead of utilizing the funds for their intended purpose, he funneled the money through a convoluted network of entities linked to friends and family members, ultimately redirecting the funds back to himself.

Federal prosecutors revealed that the defendant had also built excessively personal relationships with his clients, further abusing his position as an investment advisor. This manipulation extended to three siblings, aged 83, 86, and 93, all living together. Despite sharing holidays and personal moments with them, the Wells Fargo advisor continued his fraudulent activities unabated.

The scheme began to unravel when the siblings grew suspicious of the lack of investment returns and confronted the defendant. In response, he sent them falsified documents purporting to show their funds in a separate brokerage firm. This deception was quickly debunked by the alleged brokerage firm, confirming the fraudulent nature of the claims.

Justice Served as Wells Fargo Collaborates in Investigation and Reimburses Victims

During the investigation, Wells Fargo cooperated closely with the authorities, highlighting its commitment to upholding the highest ethical standards for its employees. In addition to cooperating with the investigation, Wells Fargo fully reimbursed the victims, mitigating some of the financial harm caused by the rogue advisor’s actions.

The trial concluded with a guilty plea to one count of wire fraud and securities fraud. The plea deal helped the defendant avoid a potential maximum sentence of two decades behind bars. The sentencing was presided over by US District Judge Madeline Cox Arleo, who imposed not only the prison term but also a three-year supervised release period.

Gambling addiction often drives people to commit fraudulent activities. Another recent case saw a former accountant in Australia admitting to over 100 charges for using clients’ funds to support his gambling addiction. He allegedly defrauded the Australian Tax Office and clients of more than AU$1.4 million ($937,000) over five years. He moved money between clients’ accounts and a personal “fraud account,” using these funds for online gambling, including betting on races.

The post Former Wells Fargo Advisor Jailed for Gambling-Driven Fraud Scheme appeared first on Keno Wizard.

Last year, Matthew Beasley, a Las Vegas lawyer and sports bettor, came under fire for alleged participation in a $460-500 million Ponzi scheme. Beasley, who refused to cooperate with the police at first, is believed to have been a part of a group that took money from more than 600 investors to live in luxury. A new lawsuit alleges that the bank he used might have been involved as well.

The Scheme Involves Millions of Investors’ Money

Beasley and other scheme participants embellished investors’ money to buy private jets, boats, cars and luxurious properties, according to the lawsuit. Furthermore, earlier findings showed that the lawyer used a part of the money to pay back his gambling debts. He allegedly owed sportsbooks a whopping $4 million

When the police went to arrest the man, he resisted and threatened to commit suicide with a gun. When asked to put the weapon down, Beasley pointed it at the policemen, causing them to shoot him non-fatally.

The scheme Beasley participated in was believed to be led by J&J Entities owner Jeffrey Judd, who, according to Beasley, had the names of everyone involved in the fraud.

Beasley was indicted for five counts of wire fraud and three counts of money laundering for the scheme. His lawyer’s license was eventually revoked.

Well Fargo Cannot Have Missed the Scheme

As it turns out, Wells Fargo Bank, the bank which Beasley used, should have been aware of what was happening. As a result, the financial service now faces a lawsuit as well.

A court-appointed receiver, Geoff Winkler, was tasked with bringing the litigation against Well Fargo, as requested by a federal judge. The judge has reasons to believe that the bank should have immediately identified the fraudulent scheme.

According to the new lawsuit, Well Fargo should have seen the suspicious activity since the money related to the Ponzi scheme passed through Beasley’s account, according to earlier findings. According to the lawsuit, “a Ponzi scheme of this magnitude cannot run surreptitiously through an IOLTA and various related-party accounts.”

Furthermore, Well Fargo employees might have actively assisted Beasley, the lawsuit argues. As it turns out, some Well Fargo employees, including a manager at a Nevada-based branch, reported the suspicious activity. Concerningly, Well Fargo failed to take adequate action, even asking branch employees to execute the suspicious transactions.

This will not be the first time Well Fargo has been accused of having collections with the scheme. Around the same time Beasley was arrested, a lawsuit sought to find the banking firm’s relationship with the fraudsters.

The post Well Fargo Allegedly Knew of Matthew Beasley’s Ponzi Scheme appeared first on Keno Wizard.