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Regulation and Compliance > Litigation

Former New York Life Broker Convicted of Stealing $1M From Elderly Client

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What You Need to Know

  • The broker took unauthorized withdrawals from the client's annuity trust, prosecutors said.
  • The ex-broker was already convicted of Medicare fraud last year.
  • He faces a possible maximum penalty of 444 months in prison when sentenced in August.

A federal jury has convicted a former New York Life broker who was accused of stealing $1.3 million from a 72-year-old client, according to G. Norman Acker III, acting U.S. attorney for the Eastern District of North Carolina.

Furman Alexander Ford, 51, of Raleigh, North Carolina, was found guilty of 11 counts of mail fraud, 11 counts of wire fraud and two counts of aggravated identity theft. He faces a maximum possible penalty of 444 months in prison when sentenced during the Aug. 3, 2021, term of court, Acker said.

Ford was advising a client who had recently inherited real estate valued at $1.3 million. The broker was with New York Life from 2007 to 2015, according to his report on the Financial Industry Regulatory Authority’s BrokerCheck website. He is no longer registered as a broker, according to BrokerCheck.

“We fully cooperated with the appropriate authorities throughout these proceedings and reimbursed the victim for her losses,” a spokesperson for New York Life told ThinkAdvisor on Wednesday.

Thomas Reston Wilson, an attorney for the law firm Greene & Wilson who was representing Ford, according to court documents, did not immediately respond to a request for comment.

On Oct. 8, a federal grand jury returned an indictment charging Ford with conspiring to defraud the Medicare program by submitting false claims for services that were never provided.  On Aug. 26, Jimmy Guess, 62, of Greensboro, pleaded guilty to the conspiracy to defraud Medicare in the same case.

Fraudulent Withdrawals

Ford assisted in the sale of his client’s property and the setup of a charitable annuity trust with NYL using the sale proceeds, according to Acker, who noted the victim was Ford’s primary client while employed at the firm.

The trust was created to pay the victim $6,000 per month during her lifetime, Acker said. “As part of Ford’s responsibility as the victim’s financial agent, he drafted and submitted authorized letters of withdrawal from her annuity account to pay for certain expenses,” according to Acker.

NYL customer service guidelines required that the financial agent have the client sign a withdrawal letter in person with “wet ink” before submitting it to NYL by mail. The funds would then be electronically wired to the recipient as directed by the client with their full knowledge and consent, according to Acker.

During the investigation, agents identified 20 separate fraudulent letters of withdrawal drafted by Ford and submitted to NYL headquarters in New York on behalf of the client, Acker said. The letters were all mailed by Ford through UPS from his office in Raleigh. The funds requested ranged from $5,000 to $45,000 and totaled more than $400,000, according to Acker.

The proceeds were then electronically wired by NYL to Ford’s personal checking account, Acker said, noting the money was used by the broker for personal products and services. “An FBI financial analysis traced the funds to the purchase by Ford of various personal items, including a BMW vehicle, Rolex watches, firearms, child support, and a cruise to the Bahamas,” Acker said.

On Dec. 29, 2014, Ford withdrew $1 million from the client’s annuity account, according to Acker.

“Integrity and trust are characteristics that all financial agents should embody,” Acker said in a statement. “Unfortunately, the defendant used his position to prey upon one of our nation’s most vulnerable citizens and today he was held accountable for his criminal actions.”