[ by Melanie Gretchen ]

Wells Fargo Advisors and E*Trade Securities are liable for spousal theft, according to a FINRA arbitration panel, which ruled in favor of an investor-client.

Arb Panel's Findings.   According to the securities arbitration law firm, Maddox Hargett & Caruso, P.C., which represented the claimant, the former husband of its client falsified documents and used other means of identify theft to effect fund transfers from various Wells Fargo accounts into several E*Trade accounts – all without the knowledge or consent of his former wife.

"Our client was the victim of a very focused and intentional scheme that was permitted to occur – if not facilitated – by both Wells Fargo and E*Trade.  Mark Maddox added that the panel's decision demonstrates that not only is the stealing spouse liable, but so is the brokerage firm.

Award Granted to Claimant.   The panel ordered Wells Fargo Advisors and E*Trade Securities to pay the claimant $50K and $33.5K, respectively, in compensatory damages.  In addition, Wells Fargo Advisors and E*Trade Securities have to pay the investor $12K in interest, $22.5K in attorney fees, and $4.5K in arbitration hearing costs.             [DailyFinance, 3/27/13]

To contact Melanie Gretchen: melanie@compliance-insights.com.