David Rockwell, a former financial advisor in Cape Coral, was sentenced to five years in federal prison on Wednesday after pleading guilty in January.
According to the Department of Justice, Rockwell was a previously registered broker and investment adviser before being barred by FINRA. The DOJ charged Rockwell with wire fraud and bank fraud charges for his actions beginning as early as October 2017.
The DOJ found that Rockwell used his clients’ money for his own purposes. Rockwell also reportedly opened two lines of credit in his clients’ names. In total, Rockwell applied for $700,000 in credit with his clients’ names. In doing so, court records show that he forged his clients’ signatures and used his clients’ assets as collateral on the loans. Rockwell also failed to notify or obtain permission to act on behalf of his clients.
On another occasion, Rockwell reportedly pitched a low-income housing investment to an investor that totaled nearly $400,000. However, instead of putting this money toward the aforementioned investment, Rockwell used the money for his own purposes, including the purchase of a home.
In total, the court entered a judgment against Rockwell in the amount of $1,018,000.
FINRA BrokerCheck®
The FINRA BrokerCheck® tool shows that Rockwell had ten disclosures, which is quite concerning.
FINRA publishes “disclosures” which include reports of any possible acts of wrongdoing. FINRA states that disclosures include “customer complaints or arbitrations, regulatory actions, employment terminations, bankruptcy filings and certain civil or criminal proceedings” that involve the individual in question.
Since 2013, Rockwell accumulated both criminal and civil disclosures on his BrokerCheck® report. Most recently, seven of Rockwell’s ten disclosures occurred in the past three years alone. Three of these disclosures involved customer disputes, two of which amounted to six-figure settlements. The third disclosure is currently pending on the FINRA site, but it is likely related to the $1M+ judgment that was issued this week.
Tools like FINRA BrokerCheck® provide valuable insight into financial professionals. Although it may not prevent all types of fraud, it is a great starting point before deciding to trust an investment professional with your money. To learn more about how to protect yourself as an investor, check out our blog resources here.
Remember, whatever it is, let’s make sure our money is working for us rather than somebody else.
Vernon Litigation Group represents investors throughout the United States and abroad in securities litigation and arbitration. We handle a number of related securities claims (link), including breach of fiduciary duty, investment fraud, disputes with financial institutions, FINRA arbitration, and more. Call us at 239-314-4434 for a confidential, no-cost consultation.