Ex-Morgan Stanley Advisers Plead Guilty to Fraud Charges
From the Desk of Jim Eccleston at Eccleston Law LLC:
Two former Boston-area Morgan Stanley financial advisers, James Polese, 51, and Cornelius Peterson, 28, both have pled guilty to one count of conspiracy, one county of investment adviser fraud and three counts of bank fraud. Polese also has pled guilty to another five counts of bank fraud and one count of aggravated identity theft.
According to federal prosecutors in Massachusetts, between 2014 and 2017, Polese and Peterson transferred approximately $850,000 out of three client accounts, without their consent, to fund their own investments in a wind farm project. Polese also transferred approximately $93,000 out of one of his client’s account to pay for his children’s college tuition.
In a separate action, the SEC filed a civil complaint against Polese and Peterson accusing them of violating the Securities Exchange Act and the Investment Advisers Act. In the civil complaint, the SEC asserted that Polese and Peterson should be forced to disgorge their “ill-gotten gains” and also pay civil penalties.
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