Former Raymond James broker, Claus Foerster, has been barred from the securities industry after the Financial Industry Regulatory Authority Inc. (FINRA) accused him of stealing over $3 million from clients since 2000. Foerster, whose office was based in Greenville, South Carolina, had a large client list and it is likely that many investors may have been affected by his illegal and illicit actions.
Prior to the FINRA action against Foerster, the law firms of Vernon Litigation Group and Dovin Malkin & Ficken filed an arbitration claim against Foerster and Raymond James. The claim asserts that Foerster, acting as a broker for Raymond James & Associates, mismanaged the funds of an elderly South Carolina woman and made numerous unauthorized trades that benefited Foerster but resulted in significant losses for the customer.
Claus Foerster began his career in 1988 at J.C. Bradford & Co. He obtained his Series 7 license and Series 63 license in 1989. Between July of 1997 and June 3, 2014, Foerster was registered with three FINRA member firms—Citigroup, Morgan Keegan & Co., and, most recently, Raymond James & Associates, Inc. Foerster was a broker for Florida-based Raymond James from February 13, 2013, until June 3, 2014, when the scheme described below was uncovered.
According to FINRA, beginning in 2000, Foerster solicited at least 13 securities customers to invest in an income-oriented entity known as S.G. Investments. It appears that Foerster instructed customers to transfer funds from their brokerage accounts to their personal bank accounts. The customers were then instructed to write checks from their personal bank accounts to “S.G. Investments.” S.G. Investments, as the investigation has revealed, was not an investment fund, but a bank account controlled by Foerster. In furtherance of his plan, Foerster provided at least some of the customers with fictitious account statements and purported dividend payments. Through this fraudulent scheme, Foerster converted at least $3 million from customers.
Claus Foerster has signed a letter accepting FINRA’s punishment without admitting to the allegations. A spokeswoman for Raymond James, Anthea Penrose, has stated that Foerster admitted to misappropriating funds through a private, phantom investment fund he created outside of Raymond James.
Foerster’s association with Raymond James was terminated on June 4, 2014, Since then, Raymond James has tried to distance itself from Foerster’s actions. Ms. Penrose publically stated that Foerster’s actions at no time involved Raymond James and that no investments were made directly from Raymond James accounts. All customers of Claus Foerster are encouraged to closely examine their portfolio and consult with a securities attorney before speaking with Raymond James or signing any sort of release.
If you were a customer of Claus Foerster, contact the experienced securities lawyers of Vernon Litigation Group. Our attorneys began investigating the potential wrongdoing of broker Claus Foerster well in advance of the official FINRA action. We have successfully represented investors against Florida firm Raymond James before, and are prepared to do so again on behalf of any investor who has fallen victim to investment misconduct. To schedule a free consultation, please call Vernon Litigation Group toll-free at (239) 319-4434 or by email at firstname.lastname@example.org.