A former LPL Financial stockbroker pled guilty to wire fraud in connection to a theft of $600,000 from a client. The customer was 73 years old.
Prosecutors say ex stockbroker Matthew Clason was an investment advisor and a registered representative of Lincoln Financial Advisors Corporation and later LPL Financial LLC. Beginning in 2015, Clason began providing investment services to the victim.
In January 2018, Clason and the victim opened a joint bank account. From 2018 to August 2020, Clason made more than 60 electronic transfer totaling $668,000 from the victim’s investment accounts into the joint bank account and, without the victim’s knowledge or authorization, withdrew more than $621,000 in cash from that account for his personal use.
Clason entered a guilty plea at his arraignment and is expected to be sentenced in August. He faces 20 years in prison although the government as part of his plea deal indicated the sentence under the federal sentencing guidelines should be between 33 to 41 months.
Because Clason abused a position of trust and because the victim is classified under the guidelines as “vulnerable,” the government wants the sentence enhanced. Typically when defendants take early responsibility for their actions, however, courts are more lenient.
Records from the Financial Industry Regulatory Authority’s BrokerCheck system show that Clason was fired by last August by LPL Financial. FINRA records also show a customer complaint last year for $1 million.
Always Check Your Broker Before Investing
Readers of this blog know that we always recommend checking the FINRA BrokerCheck system before investing. It’s free and incredibly easy to use. All stockbrokers are required to be registered with FINRA. Investment advisors are registered with the SEC.
Checking BrokerCheck will let you know if they are registered with either agency and provide a full and detailed report of any prior customer complaints, regulatory actions, lawsuits, bankruptcies and even criminal complaints.
While no system is fool proof, it is good to know who you are dealing with and whether they are licensed. You can also call the state securities agency in the state where you reside. (Brokers have to be registered where their customers are located.)
Checking BrokerCheck might not have helped the victim in this case but we often see horrible outcomes that could have easily been avoided with a little due diligence.
Broker Check also lets you check out the firm where the broker is employed. It is inevitable that a large brokerage firm will have some customer complaints. No company can make every customer happy. The information contained in BrokerCheck reports is still useful, however.
Does the firm simply have a just few customer complaints or dozens? Are there regulatory actions? What do those regulatory actions say?
Visit our sister site and search the blog for LPL Financial and you will see many complaints. We worry that customers are especially at risk when dealing with brokerage firms that are constantly accused of failing to properly supervise their employees. [One of our most recent posts is LPL Financial in Trouble.]
In our opinion, LPL should have seen that dozens are transfers were going from the victim to Clason’s account. Stockbrokers, of course, can’t even have joint bank accounts with their clients.
Elder Financial Abuse and LPL Financial
The 73 year old victim from Connecticut is unfortunately not the first senior to complain about LPL Financial.
We understand that investment funds are often a vital component of a strong and successful retirement plan. Unfortunately, bad financial advice continues to plague senior investors.
Even highly reputable brokerage firms and financial advisors may attempt to take advantage of elderly customers’ hard-earned dollars for their own financial gain. As noted above, the gentlemen in Connecticut isn’t the first senior to accuse LPL Financial of elder financial abuse.
In 2014, the SEC obtained a $1.8 million judgment against former LPL stockbroker Blake Ricahrds. The feds say that while working at LP Financial, Richards stole money from elderly clients.
Massachusetts securities regulators have also pursued LPL for overcharging seniors. Illinois took similar action.
Elder investors who have suffered financial losses due to broker misconduct or negligence may be eligible to recover their financial losses through the Financial Industry Regulatory Authority (FINRA) arbitration process. FINRA views the protection of senior investors as a top priority, placing particular emphasis on the suitability of investment recommendations offered to senior investors, communications directed toward elderly investors and potentially abusive or dishonest sales practices or fraudulent conduct targeting senior investors.
Our experienced Elder Financial Loss Recovery lawyers have helped many elderly investors recover millions of dollars lost to investment fraud. We represent victims of bad investment advice in both FINRA arbitration and federal court.
Common stockbroker and financial advisor elder financial abuse scams include:
- Breach of Fiduciary Duty: The stockbroker places their own financial interests (commissions) over the interests of the investor.
- Failure to Diversify: Investment advice results in inadequately diversified portfolio, increasing risk.
- Failure to Supervise: Investment firm fails to adequately supervise the activities of its financial advisors, brokers or representatives.
- Misrepresentation: Broker or financial advisor fails to present all pertinent investment information and related costs and risks.
- Unsuitability: Investment firm fails to consider investor’s age, investment experience, financial status, risk tolerance or other relevant criteria when recommending investments.
- Unauthorized Trading: Investment firm trades on investor’s account without required consent.
- Account Churning: Generating excessive fees or commissions by recommending unnecessary or excessive trading.
If you suspect your investment losses are the result of stockbroker or investment advisor misconduct, you may have a claim to recover your losses. Contact an experienced stockbroker fraud lawyer today for a free, confidential consultation.
833.201.1555, email [hidden email] or complete the Online Form. We also invite you to visit our Elder Financial Abuse information page.
Our experienced elder fraud lawyers represent senior investors nationwide. We have extensive experience representing investors who have suffered large financial losses at the hands of the most reputable investment firms. We are happy to speak privately with you about your financial situation in a free consultation. Cases are handled on a contingency fee basis meaning there are no fees or costs unless we first recover money on your behalf.