Former stockbroker Michael D. Montgomery pleaded guilty on June 22 to charges of wire fraud and filing a false tax return. The charges were brought at the U.S. District Court in Tacoma, Washington, though Montgomery had moved to Aspen, Colorado in an effort to outrun the charge.
News: Stockbroker pleads guilty to wire fraud | U.S. District Court
BrokerCheck Report: Michael Dennis Montgomery
Licensed as a broker and investment adviser with Wachovia Securities Financial Network, LLC, and subsequently with Mutual Service Corporation in Washington until his license and registration as a securities dealer was revoked in 2009 for unethical conduct, Montgomery admitted stealing what prosecutors believe is over $1 million from an elderly client in Tacoma.
Montgomery was barred from the financial industry in 2011 (Disciplinary Proceeding No. 20090190544) after failing to provide information, produce documents and cooperate with a Financial Industry Regulatory Authority (FINRA) request for an interview earlier that year.
Montgomery met his client while an investment adviser and eventually persuaded the elderly victim to name Montgomery the trustee of the client's revocable living trust and grant him power of attorney.
From 2003 to 2007, Montgomery employed deceitful and fraudulent tactics and schemes to dupe his victim out of money originally residing in the elderly man's bank and investment accounts. The Internal Revenue Service and federal prosecutors additionally maintain that from 2005 to 2007, Montgomery facilitated the wire transfer of $654,600 from the victim's Charles Schwab account to the client's Key Bank account. Once the Schwab money was with Key Bank, Montgomery allegedly withdrew the entire sum for personal financial gain.
Prosecuters also allege that between 2004 and 2006, Montgomery wrote checks from his client's account totaling $598,916. Finally and following his client's death in 2006, Montgomery wrote another $243,745 in checks to himself, claiming the expense as a fee for "estate services." Montgomery additionally failed to report these activities to the victim's family, did not keep accounting records and neglected to report the extra income on his federal tax returns.
If you suspect a broker or firm has engaged in unsuitable, improper, fraudulent or misleading practices or has coerced you into making decisions that have proven harmful to your investments or interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for an investigation and consultation.