Arizona regulators have penalized Scottsdale-based broker-dealer United Planners Financial Services of America more than $1 million for failing to uncover a longtime fraud perpetrated by one of its securities salesman.
That rep, Philip A. Riposo, has since died, but the Arizona Corporation Commission in Phoenix claims he had swindled $4.5 million from his customers over 30 years, since long before his association with United Planners.
Riposo, of Cave Creek, Ariz., worked for United Planners from December 2013 through March 2022, and the commission said that while there he stole $1,059,823 from 24 clients (in one case, the amount was as high as $513,000). The commission said he covered his tracks with bogus financial statements, and that the activity wasn’t discovered until a client complained in March 2022.
“At that point, the fraudulent scheme was uncovered, with Riposo admitting to engaging in the scheme for more than 30 years,” the Arizona letter said, adding that Riposo died in 2023 before the commission could conclude a case it had brought against him personally. He was barred by the Financial Industry Regulatory Authority (Finra) in April 2022 after failing to appear for testimony about his firing by United Planners, according to the Finra website. His BrokerCheck page includes 13 customer complaints, including accusations of misappropriation and conversion of client money, as well as unsuitable investments.
Riposo had been working largely out of his Cave Creek home office since 2017, operating as a one-man satellite branch, according to the Arizona commission’s cease and desist letter, filed July 18. While United Planners’ written supervisory procedures called for onsite visits, the two visits in 2016 and 2019 were not surprise inspections, the commission said, and the firm didn’t catch any fraudulent activity.
“On March 1, 2022, [United Planners] received a complaint from a Riposo customer named R.J. who described difficulty in obtaining funds from his investment account,” the letter said. “Upon investigating, [United Planners] learned that (i) Riposo was corresponding with R.J. using an unapproved email account, (ii) Riposo was using unapproved letterhead, (iii) Riposo was sending checks directly to R.J. out of a checking account for Riposo Asset Management (“RAM,”) which was Riposo's business account, and (iv) R.J. did not appear to have any assets on deposit with [United Planners].”
The firm’s reps made a surprise visit to Riposo’s home. At first he didn’t let them in, claiming he had Covid, but when the firm eventually confronted him with documents, the letter claims the Riposo admitted to taking funds from customers for years.
Arizona’s investigation “has revealed that Riposo stole in excess of $4,500,000 from his customers, excluding interest.” Before he was at United Planners, Riposo had been affiliated with a number of other broker-dealers, including high-profile ones like Cadaret Grant, LPL and Securities America.
He died June 18, 2023, according to commission documents.
The commission said that United Planners consented to the order without admitting to nor denying the findings. The firm did not immediately respond to a request for comment.