Finra bans broker for stealing $4.2M

One victim suffered from Alzheimer's, regulator says

Jul 28, 2013 @ 8:31 am

By Dan Jamieson

Finra has barred a California broker and expelled his broker-dealer firm over allegations that he stole $4.2 million from two clients, one of whom Finra said suffers from Alzheimer's disease.

John Thornes, president of Thornes & Associates Inc. of Redlands, Calif., was barred from the industry, and his firm was expelled from Financial Industry Regulatory Authority Inc. membership.

Finra alleged that from December 2010 to January 2013, he converted customer assets in two trust accounts, using at least 50 transactions falsely characterized as loans, and transferred the money to two of his friends.

One victim was a 77-year-old retired homemaker with Alzheimer's who lived in a nursing home, Finra said in the settlement agreement.

Mr. Thornes diverted about $1.7 million from the homemaker's $2 million trust account, Finra said.

In another instance, a $3 million trust account created by a deceased friend of Mr. Thornes' parents to fund educational scholarships was depleted of $2.5 million, using the same fictitious loan scheme, Finra claimed.

None of the loans has been repaid, Finra said.

Mr. Thornes didn't respond to a call and an e-mail.

The case was settled July 18 and recently released by Finra. It isn't clear whether Mr. Thornes faces criminal charges in the matter.

0
Comments

What do you think?

View comments

Recommended for you

Featured video

Events

AXA's Day: Why annuities are returning to favor

Advisers are using annuities more than ever to help drive retirement income. Graham Day of AXA explains why and what's to come for this solution.

Latest news & opinion

Merrill Lynch fined $42 million for misleading customers

In addition to the practice of 'masking' trades, the wirehouse went to extremes to cover up the wrongdoing.

Advisers with billions in AUM leaving Wall Street

Merrill Lynch has seen two teams exit recently, each with more than $4 billion in client assets.

Wells Fargo weighs changes to wealth unit

The move would reflect the bank's effort to cut $4 billion in costs.

Small broker-dealers seek legislative relief from annual audits

Bills introduced in House, Senate would remove PCAOB requirement.

Meet our new 40 Under 40s

For a fifth year, InvestmentNews is proud to shine a spotlight on the amazing accomplishments and potential of top young financial professionals.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print