Forum Thread

FINRA fines Wells Fargo

Reply to ThreadDisplaying 3 Posts
  • Are you sure you want to delete this post?

    FINRA arbitration panel has fined Wells Fargo $400 a day because its broker Leonard Kinsman scammed widow Robin Fratto out of her deceased husband's life insurance money.

    The article states, "Kinsman forged his client's signature on a number of documents authorizing high-risk trading with the proceeds of the life insurance settlement. He is also accused of improperly selling her two illiquid annuity products with high fees that she had to cash in prematurely to get her $580,000 house out of foreclosure."

    And it goes to state, "he then made speculative investments with the money, buying puts on the market calls on gold, foreign oil stocks, large short-term bets of several hundred thousand dollars on a single mutual fund and other improper short-term trading, all of which earned him substantial commissions and likely undisclosed fees despite incurring large losses for the client."

    What should be done about Wells Fargo?

  • Are you sure you want to delete this post?

    Members on this website are not qualified to make legal judgements regarding cases like this, but none the less it sure would appear to us laymen that Wells Fargo has been a litigant in more than just this case. I looked this case up and more...

    Wealth Management, Dec 6, 2019: Wells Sanctioned in Forgery, Fraud Case by FINRA Panel

    "A FINRA arbitration panel has ordered Wells Fargo Advisors Financial Network to pay a fine of $400 per day in connection with a claim by a New Jersey widow that her Wells broker, Leonard Kinsman, of Staten Island, lost almost $600,000 of her $2,250,000 life insurance payment through risky trades made without her consent."

    This is probably not the same article you cited but close enough. Yes it appears that the Wells Fargo broker was especially aggressive in the use of her funds.

    Based on the information provided and if it is accurate, the New Jersey widow would appear to have a strong case against Wells Fargo. I hope she wins her case, but I would expect that the court cases and appeals could drag on for months or years. That's how these big banks win...delay, delay, delay...

    In Googling Wells Fargo and FINRA (Financial Industry Regulatory Authority) or "Wells Fargo fined" you'll find other instances in which Well Fargo has been less than honest with their clients.

    Similar to the case above, in 2017, the Financial Industry Regulatory Authority (FINRA) "ordered Wells Fargo Clearing Services, LLC and Wells Fargo Advisors Financial Network, LLC to pay more than $3.4 million in restitution to affected customers for unsuitable recommendations of volatility-linked exchange-traded products (ETPs) and related supervisory failures."

    But here's a big one from 2018:

    New York Times, Wells Fargo Said to Be Target of $1 Billion U.S. Fine

    "Federal regulators are poised to impose a $1 billion fine on Wells Fargo for years of selling unnecessary products to customers, the toughest action by the Trump administration against a major bank."

    I wish the New Jersey widow luck...

  • Are you sure you want to delete this post?

    John Stumpf, the former Wells Fargo chairman, decided to retire (rather suddenly) in October of 2016. His golden parachute was worth $134 million.

    His wife recently purchased a $9 million home in Paradise Valley (a pricey Phoenix suburb) - and paid cash.