Wells Fargo Stockbroker Barred For Conversion
Jeffrey E. Krupnick, of Sarasota, Florida, a stockbroker formerly employed with Wells Fargo, has been barred from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity according to an Extended Hearing Panel Decision containing findings that Krupnick converted a customer’s funds. Department of Enforcement v. Jeffrey E. Krupnick, Disciplinary Proceeding No. 2014043869901 (Jan. 8, 2018).
According to the Decision, Krupnick converted $143,000.00 worth of customer MK’s funds. Evidently, Krupnick attempted to keep MK in the dark about his activities, where he utilized his access to MK’s investment accounts to misappropriate funds of MK over a period of time. The Decision stated that MK attempted to gain access to his accounts statements; however, Krupnick refused to provide them to MK. MK then reportedly complained to Wells Fargo about Krupnick’s activities; however, Krupnick denied having done anything improper with respect to MK’s funds.
The Decision stated that Krupnick confessed to his Wells Fargo colleague that Krupnick actually converted MK’s funds. Particularly, Krupnick worked with Mitchell Halperin at the firm’s Sarasota office, in which they shared the administration of investor accounts to boost the amount of assets that Krupnick managed. Krupnick was apparently responsible for new business generation, while Halperin handled administration of activities at the Sarasota office as vice president of investments.
The Decision stated that Halperin provided testimony to FINRA regarding his knowledge of a complaint lodged against Krupnick in November of 2014 that involved accusations of Krupnick’s wrongdoing with handling the customer’s trades. Evidently, Krupnick’s registration with Wells Fargo followed the customer’s complaint, at which point Halperin took over Krupnick’s customer accounts. At that time, Krupnick reportedly informed Halperin that he had been accused of stealing MK’s funds, and that Krupnick had actually taken MK’s funds.
Krupnick reportedly denied having committed conversion when accused by FINRA, claiming that he was permitted to withdrawal, transfer and make use of MK’s funds. Krupnick claimed to FINRA that funds had been provided to him by MK on an interest free basis. However, FINRA’s Extended Hearing Panel did not find Krupnick’s statements to be believable. FINRA’s Extended Hearing Panel found that MK’s investment account was treated similarly to Krupnick’s own banking account, where he directed several transfers of MK’s joint account funds to Krupnick’s own accounts, misappropriating thousands of dollars from time to time for Krupnick’s benefit.
FINRA found that Krupnick attempted to conceal his activities by designating accounts statements to be transmitted to himself rather than providing those statements to MK. Krupnick evidently exacerbated his wrongdoing by providing misleading, incomplete and inaccurate statements to FINRA staff in the course of FINRA’s investigation of his activities. Consequently, FINRA’s Extended Hearing Panel concluded that Krupnick’s conduct was violative of FINRA Rules 2010 and 2150(a).
FINRA Public Disclosure reveals that on July 19, 2012, a customer filed an investment related written complaint involving Krupnick’s conduct, alleging that closed-end fund transactions were placed in the customers’ account that were not suitable for the customers in consideration of their ages and objectives for investing. Subsequently, on June 3, 2015, a customer initiated investment related written complaint regarding Krupnick’s activities was resolved for $240,000.00 in damages supported by allegations that Krupnick executed unauthorized transactions in the customer’s investment account.
Following Krupnick’s termination from Wells Fargo Advisors, he was associated with Ameriprise Financial Services, Inc. between August 14, 2015 and October 28, 2017, where he was terminated after having been sanctioned by FINRA for failing to cooperate in an investigation into his misconduct.
The information contained herein has been obtained from reliable sources however may not be accurate and is not guaranteed by us. Readers are encouraged to undertake their own independent investigation and evaluation of the relevant facts. All claims and allegations are subject to adjudication, decisions may be subject to appeal, and no inference is intended, nor should any inference be made from any information contained herein from any source.
This posting and the information on our website is for general information purposes only. This content should be not considered legal advice, and any responses, comments, e-mails, other communications do not form any attorney client relationship. Attorney Advertisement. See Important Disclaimer
Guiliano Law Group
Our practice is limited to the representation of investors. We accept representation on a contingent fee basis, meaning there is no cost to you unless we make a recovery for you. There is never any charge for a consultation or an evaluation of your claim. For more information, contact us at (877) SEC-ATTY.
For more information concerning common claims against stockbrokers and investment professionals, please visit us at stockbrokerfraud.com
To learn more about FINRA Securities Arbitration, and the legal process, please visit us at securitiesarbitrations.com