A former Morgan Stanley financial advisor charged with stealing from elderly relatives, including his own mother, pleaded guilty Tuesday to federal violations in the Eastern District of Texas, according to the U.S. Attorney’s Office for the Eastern District of Texas.
Doug McKelvey pleaded guilty to money laundering charges before Magistrate Judge Kimberly C. Priest Johnson.
McKelvey was a vice president with Morgan Stanley in South Lake, Texas, from 2009 to April 2022, when he was terminated for allegedly misappropriating funds from client accounts. In August 2022, he was barred by the Financial Industry Regulatory Authority Inc. for refusing to provide information and documents Finra requested.
According to the U.S. Attorney’s Office, McKelvey misused at least $1.5 million of investor funds held in brokerage accounts belonging to clients that included his mother and another elderly family member. Instead of investing the money on behalf of his clients, McKelvey used the funds to pay for vacations, restaurants, salons, and other personal expenses.
"Morgan Stanley detected McKelvey’s unauthorized activity and misappropriation of funds from a limited number of client accounts held by his relatives," a spokesperson said in an emailed statement. "Morgan Stanley terminated McKelvey and amicably resolved the matter with his relatives.”
McKelvey faces up to a decade in federal prison. A sentencing hearing will be scheduled after the completion of a presentence investigation by the Probation Office.
In a parallel complaint, the Securities and Exchange Commission charged McKelvey with fraud on Wednesday for the same abuses.
The SEC said in a statement that McKelvey “initiated over 300 fraudulent and unauthorized disbursements of funds from the two customers' accounts to make payments on credit cards used by McKelvey and his wife to pay their personal expenses.”
The SEC also alleged that McKelvey sold securities from the customers' accounts to generate some of the funds he misappropriated and “took steps attempting to conceal his misconduct.”
Mayer Brown, GWG's law firm, agreed to pay $30 million to resolve conflict of interest claims.
Orion adds new model portfolios and SMAs under expanded JPMorgan tie-up, while eMoney boosts its planning software capabilities.
National survey of workers exposes widespread retirement planning challenges for Gen Z, Millennials, Gen X, and Boomers.
While the choice for advisors to "die at their desks" might been wise once upon a time, higher acquisition multiples and innovations in deal structures have created more immediate M&A opportunities.
A father-son pair has joined the firm's independent arm in Utah, while a quartet of planning advisors strengthen its employee channel in Louisiana.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
How intelliflo aims to solve advisors' top tech headaches—without sacrificing the personal touch clients crave
