A financial advisor based in Massachusetts has been ordered to pay more than $500,000 in restitution for defrauding a 9/11 widow in a scheme that cost her more than $2 million.

James J. Konaxis, formerly a registered representative of Sentinel Securities, a broker-dealer in Beverly, Mass., was ordered by a federal district court judge in Massachusetts to pay back the commissions he made over a two-year period totaling $483,460, plus interest in the amount of $31,494 and a civil penalty of $10,000 for the fraud scheme.
He had previously been barred by the SEC from participating in any offering of penny stock and barred from any association with any broker-dealer, investment advisor, municipal securities dealer or transfer agent.

He was charged in the scheme by the SEC and had previously agreed to the prohibitions against working as a financial advisor, but contested the monetary damages. The monetary punishment was ordered by Federal District Court Judge Denise L. Casper on March 14.

He took $3.7 million from a 9/11 window who had been paid by the September 11th Victim Compensation Fund and decreased her holdings to $1.6 million through bad investments in which he disregarded his clients interests, the SEC says.

He misled the victim into thinking her investments were safe while churning, or excessively trading, her funds, the SEC says.