Former Wells Fargo broker could face 15 years in prison for embezzlement

Barred broker is charged with stealing more than $500,000 from the trust fund of two elderly clients

Aug 16, 2018 @ 2:00 pm

By Jeff Benjamin

A former Wells Fargo adviser, who was barred from the industry in 2015, is facing felony embezzlement charges for allegedly stealing more than $500,000 from a trust fund he was overseeing.

David Homan of Saginaw, Mich., could face up to 15 years in prison if convicted of misappropriating $513,211 from a trust fund between 2009 and 2014, according to a report published by MLive.com.

Mr. Homan, 68, who resigned from Wells Fargo in April 2014, is accused of abusing his position as trustee for two elderly clients, sisters Elizabeth and Frances Stafford.

The case, which was resolved in civil court in 2014, claims that Mr. Homan became co-trustee of the fund in 2003 and became sole trustee when Elizabeth Stafford died in 2009 at age 93, at which time the fund was reportedly worth $516,000.

After Frances Stafford died in 2013 at age 84, and a third sister, Louise Larsen, died in 2014 at age 92, the next level of beneficiaries was Ms. Larsen's three daughters. By that point, Mr. Homan had already misappropriated most of the assets in the trust fund.

According to MLive, an independent audit of the trust fund showed that Mr. Homan had electronically transferred money from the fund to his personal banking accounts.

Also, in late 2013, Mr. Homan wrote a check for nearly $35,000 to a local car dealership to purchase a 2014 Chrysler Town & Country, which was registered to his wife.

During the civil suit in 2015, Wells Fargo was charged with failure to recognize issues such as Mr. Homan's having the same address as the trust account.

"At Wells Fargo, we hold our advisers to the highest ethical standards. The adviser involved in the matter is no longer affiliated with Wells Fargo Advisors. He resigned in April of 2014 during our review, and we resolved the matter with the affected client in 2015," the company said in a statement.

Mr. Homan's lawyer did not respond to a request for comment for this story.

The civil suit resulted in a $1.54 million judgment against Mr. Homan.

Mr. Homan, who could not be reached for comment, worked at Wells Fargo from 2009 to 2014, according to Finra BrokerCheck. Prior to Wells Fargo, he worked at UBS Financial Services from 2004 to 2009. Before joining UBS, Mr. Homan worked at Merrill Lynch for 18 years.

Mr. Homan, who was arraigned in Bay City District Court on Aug. 13, is scheduled to appear for a preliminary examination on Aug. 30.

0
Comments

What do you think?

View comments

Recommended for you

Featured video

INTV

Where in the U.S. are RIAs growing the fastest?

InvestmentNews' deputy editor Robert Hordt talks to senior columnist Jeff Benjamin about his report on how registered investment advisers are faring in different regions of the country.

Latest news & opinion

With stock market in a correction, is a recession just ahead?

Some say the market is overreacting to bad news — but what if it's not?

10 tips for hiring top young advisers

Hiring is not easy and retaining good employees can be even more difficult. Here's a roadmap for bringing on new advisers and training them — and even firing them, if necessary.

8 adviser fears for 2019

Interest rates, trade wars and bear markets, oh my! Looking across the industry, here are some of the biggest concerns heading into the new year.

3 big reasons to do a Roth conversion right now

The time is ripe for many to convert a pretax IRA to a Roth.

10 must-know facts about today's 401(k) plans

Here are the latest changes in 401(k) plans across areas such as investments, fees, contributions, investment advice and more.

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