FINANCIAL ADVISOR TARGETED THE ELDERLY
BY Chris Dolmetsch and Matt Robinson | Bloomberg Media | Thu, October 28, 2021
Ex-Wells Fargo Adviser Arrested in New Jersey on Client-Fraud Charges
(Bloomberg) — A former Wells Fargo & Co. investment adviser stole nearly $3 million from clients and used the money for personal expenses and to buy gold coins, federal prosecutors said.
Kenneth A. Welsh, 41, was arrested at his home in River Edge, New Jersey, Thursday morning on charges that he misappropriated funds from the accounts of five investors between 2016 and 2021, some of whom were “elderly and financially unsophisticated.” Welsh, who worked for Wells Fargo in nearby Fairfield, was fired in June when his conduct was discovered.
Welsh, who faces as much as 20 years in prison if convicted, was ordered released on bail following an initial appearance today before U.S. Magistrate Judge Leda Dunn Wettre (at left) in Newark, New Jersey. David Holman, a lawyer who represented him in court, didn’t immediately respond to requests for comment. Welsh is also facing a parallel lawsuit by the Securities and Exchange Commission.
“At Wells Fargo we hold our employees to the highest ethical standards,” the bank said in a statement. “We notified regulators of this matter, the financial adviser was terminated, and we are working directly with clients to reimburse them.”
Welsh transferred at least $2.59 million from client accounts to credit card accounts held in the names of his wife or parents, which he controlled, prosecutors said. He’s also accused of stealing tens of thousands more by drawing more than a dozen checks on customer accounts — at least seven of which were made out to a New Jersey coin dealer for the purchase of gold coins and one of which was paid to a company that leased automobiles.
He allegedly stole more than $1.8 million from a single victim – a resident of Whitehouse Station, New Jersey, who had initially established a brokerage account with Welsh at his previous employer and had followed him to Wells Fargo in or around 2012, prosecutors said.
The case is U.S. v Welsh, 21-mj-13385, U.S. District Court, District of New Jersey (Newark.)
(Updates with details of court appearance in third paragraph.)