AFW deals with fallout from principal’s alleged fraud
A Purchase, N.Y.-based asset management firm has made several changes to its money management systems to safeguard its clients following allegations made last week that one of its principals may have made unauthorized withdrawals from clients' accounts.
A Purchase, N.Y.-based asset management firm has made several changes to its money management systems to safeguard its clients following allegations made last week that one of its principals may have made unauthorized withdrawals from clients’ accounts.
According to a column by Ron Lieber in The New York Times on Saturday, Matthew Weitzman, one of the founders of AFW Asset Management of Natick, Mass., now doing business as AFW Wealth Advisors, is allegedly under investigation for making withdrawals from several clients’ accounts whose assets were under custody at Schwab.
AFW noted that it began its own investigation after being notified by Charles Schwab & Co. Inc. on March 30 that a “potentially unauthorized withdrawal had been made from an AFW client account at Schwab,” according to a press statement issued by AFW Wealth Advisors and Jay Furst, founding principal.
AFW then determined that there “may have been additional unauthorized withdrawals from other AFW clients’ accounts,” the statement said.
The firm notified authorities and reported the irregularities in its client accounts to the U.S. attorney general’s office and the Securities and Exchange Commission on March 31, the statement said.
“On its own and in conjunction with Schwab, AFW has taken multiple steps to safeguard its client accounts and information, through both electronic and physical means,” according to the statement. “Among other things, AFW has changed passwords, reconfigured remote access to its systems and instructed Schwab to block former AFW partner Matthew Weitzman’s access to all AFW accounts.”
The statement said that “AFW views these potentially unauthorized transactions as the isolated acts of Mr. Weitzman.”
Attorney Marc Mukasey of Bracewell-Guiliani in New York, representing Mr. Weitzman, said, “No charges of any kind, civil or criminal, have been filed against him [Mr. Weitzman].”
He also said he was aware of the press statement issued by AFW and had “no comment on the statement.”
“AFW, its many clients and I are saddened, angered and betrayed by the apparent actions of Mr. Weitzman,” Mr. Furst said in the statement.
“AFW is doing all it can to learn exactly what occurred, to assist the authorities in their investigations and to rectify the situation,” he said. “Most of all, I and everyone else at AFW are committed to serving our clients and repairing all damage caused by Mr. Weitzman.”
A spokeswoman for San Francisco-based Charles Schwab also wasn’t immediately available for comment.
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