Stock Broker Tried To Swindle $1.8 Million From Client With Alzheimer's

Featured in Zero Hedge

Daniel Drew,  6/15/2015


On Wall Street, no wolf is too big, and no sheep is too small.

At least Jordan Belfort didn't target the mentally incapacitated. This real life Wolf of Wall Street is several thousand miles away from New York in Scottsdale, Arizona, the wannabe Hamptons of the southwest. As Investment News reports, the Financial Industry Regulatory Authority (FINRA) has accused John Waszolek of making himself the beneficiary of an 81-year-old client's estate. She wanted the money to go to charity, but he thought the money should go to his own account. That's the kind of asset allocation the financial industry understands best.

JL was a widow, and she had been Waszolek's client since 1982. When he noticed her mental state deteriorating, he suspected something was wrong. In 2008, he drove her to the doctor just to make sure. She received an Alzheimer's diagnosis. Just one month later, he met with an attorney to give himself power of attorney over her financial affairs. The trust was amended so he would be a beneficiary. One day later, he resigned from UBS after 30 years at the firm. Then he transferred his business to Morgan Stanley. He did not inform either UBS or Morgan Stanley that he was a beneficiary of her estate, which is a violation of FINRA rules.

Waszolek's plan unraveled in 2010 after JL died. As Investment News reports,
A bank that was set to distribute funds from the trust refused to do so unless Morgan Stanley approved the transfer of the assets from the trust account at Morgan Stanley to the broker. Morgan Stanley denied the request, and reprimanded Mr. Waszolek, according to Finra. He was discharged from the firm in December 2011 for "concerns regarding failure to follow policies and disclosures regarding a client's testamentary bequest to the adviser," according to his U5.
Unlike many honest struggling Americans who are part of the long-term unemployed, Waszolek found a job only 2 months later. In February 2012, Raymond James decided Waszolek was solid material. They even issued a press release in his honor:
Financial advisors John Waszolek and his son Eric Waszolek recently joined the Scottsdale, Ariz., office of Raymond James & Associates (RJ&A;), according to Tash Elwyn, Private Client Group president of RJ&A; - the traditional employee broker/dealer of Raymond James Financial, Inc. (NYSE-RJF).

"It's an honor to welcome John and Eric to Raymond James," said Elwyn. "Their talent and experience will be an asset to our firm. They share our firm's values of independence and conservative management and will enhance our ability to deliver excellent service and professional advice to our clients."

John and Eric Waszolek joined Raymond James from Morgan Stanley Smith Barney, where they managed $200 million in client assets and had more than $800,000 in annual production.
Not only did Waszolek get a new job - he also received $50,000. Investment News reports,
The action ultimately resulted in a settlement in which Mr. Waszolek received $50,000. Finra did not specify who paid the $50,000 but said that the funds did not come from JL's estate. As part of the settlement, however, Mr. Waszolek agreed that the JL trust amendment was "invalid by reason of [JL's] incapacity."
I found his webpage at Raymond James. If you want, you can congratulate him on his successful career hijacking widows' estates.

John Waszolek