Source (s): Investment News—A very informative newsletter; Justia Law; SEC; FINRA; Govinfo.gov, and Thomson Reuters.
The Financial Industry Regulatory Authority Inc. is investigating and seeking to bar a former Wells Fargo Clearing Services Inc. employee who last June was charged with identity theft and bank fraud by the Justice Department.
Calvin Lee Gray was not a financial advisor but from June 2022 to March 2023 worked as a non-registered employee for Wells Fargo Clearing Services, which is the formal name for Wells Fargo Advisors.
His job title at Wells Fargo Clearing Services was securities operations representative, and he worked on the bank’s support team helping customers engage in self-directed trading, according to a complaint filed Thursday by Finra’s Department of Enforcement that seeks to formally bar Gray from the securities industry.
“Gray’s duties included performing various operational tasks, including processing, researching, and reconciling transactions related to complex securities,” Finra stated. “Gray also performed general maintenance on accounts, including updating customer name, address, and phone number.”
“Finra opened its investigation after Wells Fargo Clearing Services disclosed that Gray had been indicted for conspiracy to commit bank fraud, fraud in connection with identification documents, aggravated identity theft, and fraud in connection with access devices,” the self-regulatory organization wrote.
Gray allegedly committed the bank fraud and identity theft from around August 2022 through around April 2024, according to the federal indictment.
“Posing as his victims, Gray affiliated his own phone number and address with his victims' accounts,” the federal indictment read. “Gray then canceled debit and credit cards issued to his victims by financial institutions - including those previously listed - and ordered replacement cards sent to his own address, or addresses at which he was staying and/or could monitor and control.”
“We remain committed to maintaining the security of all our customers’ information, including continuing to apply our company-wide controls and processes to protect customer information,” said a spokesperson from Wells Fargo.
Industry attorneys said the matter showed that clients of financial institutions continue to face potential harm if they are not vigilant.
“Investors are at war and being attacked from all sides,” said Adam Gana, a plaintiff’s attorney. “They need to be extremely vigilant about protecting assets. Investors are under attack from foreign nations, banks and broker-dealers, and in this case, the employees.”
“This is the latest black eye for Wells Fargo in general and the securities industry in particular,” said Andrew Stoltmann, also a plaintiff’s attorney. “This is a jambalaya of fraud alleged against this former Wells Fargo employee and yet another issue customers need to be aware of and brokerage firms need to supervise against.”
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