Broker barred for stealing $4.2 million from two clients

Finra says one client, scammed out of $1.7 million, had Alzheimer's

Jul 22, 2013 @ 4:02 pm

By Dan Jamieson

Finra has barred a California broker and suspended his broker-dealer firm over allegations that he stole $4.2 million from two clients, one of whom Finra says 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 and January 2013, Mr. Thornes 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 have been repaid, Finra said.

Mr. Thornes did not respond to a call and an e-mail. The case was settled last Thursday and recently released by Finra. It's unclear whether Mr. Thornes faces any criminal charges in the matter.

0
Comments

What do you think?

View comments

Most watched

INTV

How the 2020 elections could impact ESG investing

Joseph Keefe, president of Impax Asset Management, on the elections and how advisers can build a bridge to the next generation of clients with ESG investing.

INTV

How advisers can be a gamechanger for women investors

Why women defer to men when it comes to finances and how advisers can combat this phenomenon and make a difference for female investors, according to Heather Ettinger, founder and CEO Luma Wealth Advisors.

Latest news & opinion

Schorsch, AR Capital to pay $60 million to settle SEC charges

The former REIT czar and his firm wrongfully obtained millions linked to REIT mergers.

CFP Board postpones enforcement of its revised fiduciary standard

Board's new Code of Ethics and Standards to be enforced next June, in line with the SEC's Reg BI

Charles Schwab reportedly in talks to buy USAA brokerage, wealth management business

The deal would net Schwab roughly $100 billion in new assets.

Advisers scramble to help retirees navigate looming Fed rate cut

The Fed's first interest-rate cut in a decade has advisers warning against chasing the bait of risk over safety.

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