According to InvestmentNews, former broker Michael Donnelly has been sentenced to 99 months in prison for stealing from clients. Donnelly pled guilty to securities and wire fraud.
Investment News reports that Donnelly was the former president to Coastal Investment Advisors in Wilmington, Delaware. Between 2007 and 2014, the SEC accused Donnelly of using funds from elderly and unsophisticated investors to pay for his personal expenses. To cover his tracks, according to the SEC, Donnelly provided false accounts statements to clients and assured them their investment were performing well.
In 2014, the Financial Industry Regulatory Authority (FINRA) barred Donnelly from working in the industry for similar allegations (read more here).
Donnelly was ordered to repay $1.99 million in restitution to investors. However, it is unclear if Donnelly has the funds to do so.
The White Law Group is investigating the potential liability the brokerage firm that employed Donnelly may have for his actions. When a registered broker defrauds clients, the brokerage firm may be liable for negligent supervision of their broker representative and could be held responsible for investment losses in a FINRA dispute resolution claim.
If you suffered losses investing with Michael Donnelly and would like to discuss your litigation options, please call the securities attorney of The White Law Group at 1-888-637-5510 for a free consultation.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Franklin, Tennessee.
For more information on the firm, visit www.WhiteSecuritiesLaw.com.