A 77-year-old blind widow was defrauded by her broker, who earned $243,000 in commissions by “churning” trades on her accounts, FINRA charged Monday.
FINRA charged Hank Mark Werner of Northport, N.Y., with making excess and unsuitable trades on the accounts of his client, earning commissions for himself and causing her to lose $184,000.
According to the complaint, Werner had been the elderly customer’s broker, and that of her blind husband until his 2012 death, since 1995. Within a few weeks of the husband’s death, Werner began aggressively trading her accounts to generate excessive commissions for himself. Werner exercised control over her accounts and recommended every trade, and the customer followed all of Werner’s recommendations, FINRA says.
Because she was blind and severely debilitated, requiring in-home care, the customer relied completely on Werner to accurately portray her account activity and let her know about account performance. Between 2013 and the end of 2015, Werner placed more than 700 trades on her account, FINRA says.
The issuance of a disciplinary complaint represents the initiation of a formal proceeding by FINRA in which findings about the allegations in the complaint have not been made, and does not represent a decision about the allegations. A firm or individual named in a complaint can file a response and request a hearing before a FINRA disciplinary panel.