According to KOMO News (12/27/12), a former stockbroker has been sentenced to five years in jail for stealing more than $1 million from an elderly man who was also his client. Prosecutors alleged the stockbroker was an investment advisor for the client, and was later given power of attorney over the man. Among the money that was reportedly stolen were more than $650,000 from a Charles Schwab account, almost $600,000 in checks written from the client's accounts and almost $250,000 in checks for estate services after the client died.
The stockbroker's registration was revoked in 2009. So far, according to prosecutors, none of the stolen money has been returned.
Elderly investors are at risk of coming up against unethical stockbrokers who will steal their clients' money for their own purposes. In some cases, they do so by manipulating the client into giving them power of attorney, gaining access to vital accounts and transferring money to themselves, spending it on luxurious items and trips.
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Research conducted by FINRA to learn more about senior investment fraud shows that victims of senior investment fraud do not necessarily fit the typical investment profile.
"Instead of being isolated, frail and gullible, fraud victims tended to be married, college-educated males with above-average incomes and above-average levels of financial literacy," Walsh noted. Furthermore, schemes to victimize seniors tended to be highly sophisticated and involve influencing the senior.
Senior investors who are victims of financial elder abuse can file a FINRA arbitration to recover their lost money.