FINRA Bars Ex-Wells Fargo Broker After Fraud Complaint
The former broker refused to testify in an investigation of his conduct, FINRA says.
A former Wells Fargo broker who was a subject of a client’s fraud complaint against the firm has been barred by the Financial Industry Regulatory Authority after he allegedly refused to appear for on-the-record testimony requested by FINRA.
Adam Thomas Marquardt signed a FINRA letter of acceptance, waiver and consent on July 14 in which he consented to being barred from the securities industry. A FINRA representative signed the letter on Thursday.
Failure to cooperate with a FINRA investigation is punishable by a bar from the industry under Rule 8210.
Marquardt joined Wells Fargo in 2008 and became registered as a general securities representative for the wirehouse in April 2010, according to FINRA.
On Aug. 21, 2020, Wells Fargo filed a Form U5 termination notice, stating Marquardt resigned from the firm on July 22 while under internal review for “allegations that … [he] deposited cashier’s checks into client accounts in part to cover certain clients’ investment losses without knowledge or authorization by the Firm.”
A client complaint in 2017 asserted several causes of action, including violations of federal securities laws, including fraud in connection with the purchase or sale of securities, breach of contract; common law fraud; breach of fiduciary duty; and negligence and gross negligence, according to a disclosure on Marquardt’s report at FINRA’s BrokerCheck website.
Also asserted by the client were violations of the Minnesota Securities Act and other state laws.
The causes of action related to the client’s allegations that Wells Fargo invested the claimant’s funds in high-risk investments that were contrary to his stated investment objectives.
The client further asserted that Wells Fargo engaged in improper short-term trading in closed-end funds and mutual fund and annuity switching, and recommended a low-priced stock that caused the client to incur unnecessary commissions and other fees.
Although Wells Fargo was the only respondent named in the complaint, Marquardt was a subject of the dispute, according to FINRA.
The client requested at least $150,000 in compensatory damages, bargain damages, lost opportunity costs, model portfolio damages, prejudgment interest, costs, reasonable attorneys’ fees, punitive damages and “other appropriate relief.”
After a FINRA Office of Dispute Resolution hearing, an arbitration panel awarded the client compensatory damages of $115,856 plus 6% interest and reimbursement fees of $300 on Feb. 16, 2018.
In his defense at the time, Marquardt said he was “not named as a party and no relief was sought against me,” adding the arbitration panel “did not make any finding that I violated any law, rule or regulation.”
“We hold all advisors to the highest ethical standards,” Wells Fargo spokeswoman Shea Leordeanu told ThinkAdvisor on Friday, adding that Marquardt was no longer affiliated with Wells Fargo Advisors Financial Network.
Marquardt joined Cetera Advisors in August 2020, according to FINRA.
Cetera and James H. West, a partner at the law firm West, Edwards & Associates who represented Marquardt, did not immediately respond to requests for comment.
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