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Ex-Wells Fargo Broker Barred by FINRA Over Ponzi Scheme

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What You Need to Know

  • The ex-Wells Fargo broker became a defendant last year in a complaint by disgruntled clients alleging he ripped them off in a Ponzi scheme.
  • He voluntarily resigned from Wells Fargo, which was also named as a defendant in the complaint.
  • Not cooperating with a FINRA investigation is a surefire way to be barred.

A former Wells Fargo broker who was named as a defendant last year in a complaint by disgruntled clients alleging he ripped them off as part of a Ponzi scheme has now been barred by the Financial Industry Regulatory Authority from associating with any FINRA member firms.

The complaint by “Q3 Investments Recovery Vehicle,” a group of the former broker’s clients, was initially filed early last year in the 13th Judicial Circuit Court of Florida in Hillsborough County and named James A. Seijas, the former broker, as a defendant, along with Wells Fargo, Skyway Capital Markets and several others.

An amended complaint was filed April 16, 2020 in a new location, U.S. District Court for the Middle District of Florida in Tampa. The main allegation was that the plaintiffs were the victims of a $35 million Ponzi scheme.

Without admitting or denying the findings of FINRA’s investigation into his practices at Wells Fargo, Seijas signed a FINRA letter of acceptance, waiver and consent on Oct. 22 in which he consented to the imposition of a bar against him by the industry self-regulating group. FINRA signed the letter on Tuesday and posted the letter on its website.

Wells Fargo declined to comment on Wednesday. Skyway and Jason Kislin, an attorney at Greenberg Traurig in Florham Park, New Jersey, who represented Seijas, did not immediately respond to requests for comment.

A ‘Fraudulent’ Hedge Fund

Seijas first registered with FINRA as a general securities representative in 1997, when he became registered as a broker and rep with Quick & Reilly, according to his report on FINRA’s BrokerCheck website.

He was registered in that capacity through an association with Wells Fargo Clearing Services between November 2013 and March 2019, when he voluntarily resigned from that firm, FINRA noted.

On March 24, 2020, Wells Fargo filed an amendment to Seijas’ Form 5 Uniform Termination Notice, “disclosing for the first time that Seijas had been named as a defendant in a lawsuit alleging that he had ‘misrepresented investments as part of a Ponzi scheme’, according to FINRA.

A March 18, 2020 disclosure on his BrokerCheck report says a plaintiff in a customer dispute alleged that, from August 2017 to December 2019, Seijas “misrepresented investments as part of a Ponzi scheme.”

Additionally, a May 18, 2020 disclosure on his report says a claimant in another customer dispute alleged that in or about January 2019, Seijas “recommended investments in a fraudulent hedge fund.” Both disputes are still pending.

Lack of Cooperation

On Sept. 29, 2021, in connection with its investigation concerning the Form U5 amendment filed by Wells Fargo, FINRA sent a request to Seijas for on-the-record testimony, according to FINRA.

However, as stated during his counsel’s phone call with FINRA on Oct. 15 and by the FINRA AWC agreement, Seijas acknowledged that he received FINRA’s request and would not appear for on-the-record testimony at any time.

By refusing to appear for on-the-record testimony as requested, Seijas violated FINRA Rules 8210 and 2010, according to FINRA. Not cooperating with a FINRA investigation is a surefire way for any broker to be barred.

(Photo: Adobe Stock)