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Were You the Victim of Former Morgan Stanley Broker Karen McKinley?

Posted on Monday, April 5th, 2021 at 6:50 pm    

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Erez Law is currently investigating former Morgan Stanley broker Karen McKinley (CRD# 5608238) for customer investment losses. McKinley has been registered with Morgan Stanley in Manchester, New Hampshire from 2009 to 2016 after he was terminated regarding, “Allegations regarding employee’s compliance with pre-trade client confirmation requirement in connection with certain trades in non-discretionary accounts.”

In September 2019, the Securities and Exchange Commission (SEC) opened an investigation into McKinley. The SEC found that a Hillsborough County New Hampshire Grand Jury indicted McKinley on seven counts of Theft by Unauthorized Taking or Transfer; four counts of Financial Exploitation of an Elderly, Disabled, or Impaired Adult; and one count of Falsifying Physical Evidence in connection with her handling of accounts of an elderly brokerage firm client from Peterborough, New Hampshire. According to the SEC, “It was alleged that between 2013 and 2016 while she was associated with the brokerage firm McKinley stole nearly $300,000 from the accounts of the elderly client… Following her guilty plea, on February 1, 2019, McKinley was sentenced to 7.5 to 15 years in prison, with four years of the sentence suspended for five years. The court also ordered McKinley to have no contact with the victim, her former client.”

In November 2016, FINRA barred McKinley after she consented to the sanction and to the entry of findings that she failed to provide documents and information requested by FINRA during the course of its investigation into allegations relating to her compliance with pre-trade client confirmations in non-discretionary accounts.

McKinley has been the subject of one customer complaint, according to her CRD report:

September 2017. “Client’s attorney seeks reimbursement of legal fees and costs expended by client in obtaining return of funds allegedly misappropriated by former FA from client’s accounts. 2014-2015.” The case was settled for $16,951.58.

Pursuant to FINRA Rules, member firms are responsible for supervising a broker’s activities during the time the broker is registered with the firm. Therefore, Morgan Stanley may be liable for investment or other losses suffered by McKinley’s customers.

Erez Law represents investors in the United States for claims against brokers and brokerage firms for wrongdoing. If and have experienced investment losses, please call us at 888-840-1571 or complete our contact form for a free consultation. Erez Law is a nationally recognized law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies on a contingency fee basis.