The Financial Industry Regulatory Authority has barred ex-Morgan Stanley advisors Ami Forte and Charles Lawrence over excessive trading in the accounts of the late Roy M. Speer, a billionaire co-founder of the Home Shopping Network who suffered from dementia and who had an extramarital affair with Forte.
Forte developed a business and romantic relationship with Speer (identified as “RS” in FINRA documents) in the late 1990s. The advisor “used her position of trust and confidence to exploit RS and generate excessive commissions from his accounts,” according to FINRA.
The regulatory group says that from September 2011 through June 2012, the Forte Group made more than 2,800 trades in Speer’s accounts, which generated roughly $9 million in commissions. About half of the transactions were tied to short-term trades of long-maturity bonds, including municipal bonds.
“Despite being hospitalized and not in contact with anyone from the Forte Group, between June 20, 2012 and June 29, 2012, RS’s accounts had over $14 million in transactions,” FINRA said in a statement.
Speer died on Aug. 21, 2012. Morgan Stanley fired Forte in the spring of 2016.
The regulatory group’s latest action, according to Forte and her attorney Robert J. Pearl, “essentially amends FINRA’s complaint so that the only remaining charge against Ms. Forte relates to trading in the Roy Speer accounts engaged in and overseen by other Morgan Stanley employees, not Ms. Forte. In entering into this settlement, Ms. Forte has not admitted any wrongdoing whatsoever in connection with this one remaining charge.”