Shepherd, Smith, Edwards & Kantas Investigating Claims for Customers of John Gregory Schmidt
Mar 31, 2019
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HOUSTON, -- Shepherd, Smith, Edwards & Kantas, LLP (SSEK Law Firm) is investigating claims involving former Wells Fargo Advisors Financial broker John Gregory Schmidt. Schmidt was an Ohio-based broker recently barred by the U.S. Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) as a result of multiple investigations into allegations of forgery, securities fraud, and theft. According to regulators, Schmidt’s misdeeds resulted in losses over a 14 year period, beginning in 2003. During most of that time period, Schmidt was a broker with Wells Fargo. Prior to that, Schmidt worked for Stifel, Nicolaus & Co., First Union Securities, Painewebber and Prudential-Bache Securities. Schmidt is also facing a 128-count criminal indictment related to his fraud involving elderly and disabled clients.
According to the SEC’s civil complaint, Schmidt ran a Ponzi scheme from 2003 -2017 where he “repeatedly sold securities [variable annuities] belonging to some of his brokerage customers [without authorization] and secretly transferred the sale proceeds to cover shortfalls in the accounts of other customers.” To cover his tracks, Schmidt issued numerous false account statements, forged client signatures, created fake customer e-mail accounts, and destroyed documents. “From Feb. 2013 through Oct. 2017, Schmidt received over $230,000 in commissions from customers who were either the source of, or recipient of, misappropriated funds.” This scheme began to fall apart when the Ohio Department of Insurance opened an investigation into irregularities during the summer of 2017. According to FINRA BrokerCheck, Schmidt was fired from Wells Fargo shortly thereafter due to allegations of “unauthorized money movement between clients” and fraudulent account statements. In March 2018, FINRA barred Schmidt for failing to respond to requests associated with FINRA’s investigation. Several former clients have filed complaints and received settlements totaling more than $2.5 million stemming from Schmidt’s activity during this 14-year time period.
If you were a client of John Gregory Schmidt or any of his financial entities, please contact the law firm of Shepherd, Smith, Edwards & Kantas, LLP today for a free, confidential evaluation of your account(s). We have a team of attorneys, consultants, and staff with over 100 years of combined experience in the securities industry and in securities law that are ready to assist you in recovering your investment losses today.
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