A Washington state unregistered financial advisor who had been barred from the financial industry in 2005 was arrested Wednesday for continuing to act as an advisor and defrauding elderly clients of their money, says the U.S. Attorney for the Western District of Washington, Jenny A. Durkan.
Jeffrey M. Knutsen, 43, of Bellingham, Wash., who owned and operated Bellwether Wealth Management, has been charged with stealing $260,000 from 17 clients’ accounts.
Knutsen was barred by Finra in 2005 from associating with any broker-dealer as a stock broker because of a customer complaint that he had embezzled from his account. Knutsen did not tell his clients that he had been barred, but told them he was moving to a different online brokerage to reduce the fees they would have to pay. He set up online accounts in his clients’ names and retained full access and control over the accounts, Durkan says.
“The elderly are particularly vulnerable to this type of fraud because some are less familiar with online trading and computer access to accounts,” says Durkan. “It is critical that trusted friends or family members assist them in tracking their resources and determining who has access to their accounts, so that they do not fall victim to this type of predatory conduct.”