Ex-Raymond James Rep Who Stole From Elderly Clients Gets 5 Years in Prison
The firm’s former broker and executive pleaded guilty to defrauding two clients out of nearly $1 million.
A former Raymond James & Associates broker and investments vice president has been sentenced to five years in prison for stealing $933,500 from two elderly clients, most of it misappropriated from a World War II veteran, according to court documents.
Frederick M. Stow, 66, of Franklin, Tennessee, was charged in June 2020 with securities fraud, wire fraud and aggravated identity theft. He pleaded guilty in August.
Stow was registered with Raymond James from 2013 to 2019, according to his report on the Financial Industry Regulatory Authority’s BrokerCheck website. The company terminated him on May 29, 2019, for “misappropriating funds from customer accounts,” according to a disclosure on his report.
Raymond James did not immediately respond to a request for comment on Tuesday.
FINRA barred Stow on Oct. 18, 2019, after he failed to respond to its request for information, effective Jan. 21, 2020, according to BrokerCheck. He is no longer registered as a broker or RIA, his regulatory reports show.
The Securities and Exchange Commission filed a civil action against Stow on June 11, 2020, in U.S. District Court for the Middle District of Tennessee, alleging he misappropriated nearly $1 million from two older clients’ brokerage funds, violating the anti-fraud provisions of the Securities Exchange Act of 1934.
In sentencing Stow on Thursday, U.S. District Judge Aleta A. Trauger “issued a stern rebuke of those in a position of trust who manage investments for others, especially the elderly, and choose to steal from them,” Mary Jane Stewart, acting U.S. attorney for the Middle District of Tennessee, said Friday.
Trauger also ordered a forfeiture money judgment of $933,500, according to Stewart.
More Details of the Case
According to court records, starting in 1982, Stow acted as the registered representative for three brokerage accounts owned by a client who was a retired airline pilot and WWII-era veteran.
Although Stow changed investment firms a few times over the years, the client moved his accounts with Stow each time, ultimately transferring his accounts to Raymond James when Stow joined that firm in 2013.
“Over time, Stow inserted himself into the financial affairs of this client and in the later years of the client’s life, he visited him at his home,” Stewart said. At a hearing, relatives testified that the client died believing that his shrinking investment accounts were caused only by stock market activity.
In October 2015, Stow started misappropriating funds from that client’s IRA account by forging wire transfer letters of authorization to permit transfers from the client’s IRA account to a SunTrust Bank account that Stow owned jointly with his wife. To accomplish the transfers, Stow sold securities in the client’s IRA account.
At the time of the client’s death at the age of 98 in March 2018, Stow had made 74 unauthorized transfers and had stolen more than $900,000 from him, according to Stewart.
Within a few weeks of the client’s death, Stow stole $32,000 from another older client by transferring money from that person’s brokerage account to another SunTrust bank account that Stow maintained, according to Stewart.
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