The Financial Industry Regulatory Authority announced Friday it has fined the brokerage arm of Fidelity Investments for failing to detect an imposter broker who stole $1 million from clients.
In the scheme that lasted from 2006 to 2013, Lisa Lewis, a one-time broker at a firm that fired her for check-kiting and improperly borrowing money from customers, told clients of her former firm falsely that she was now working for Fidelity.
When the Green Bay, Wis.-based scamster posed as a Fidelity broker, she set up accounts at that firm, including joint accounts where she and the customers were listed as co-owners.
According to Finra, Lewis stole from the customers by siphoning money from the customers’ individual accounts into the joint accounts and then transferring the sums to a Lewis-owned bank account.
Finra said Lewis also impersonated customers in conversations with the Fidelity call center to transfer the money.
In a report, Finra charged these calls were among many red flags Fidelity’s compliance system should have spotted.
Fidelity has agreed to pay Finra a $500,000 fine and to reimburse customers about the same for losses.
A year ago June, Lewis was sentenced to 15 years in prison by a federal court for fraud.
Most of the victims were seniors. Some said they were left penniless.
Finra Fines Fidelity For Failing To Detect Imposter Broker
December 18, 2015
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