Investigating Complaints Elder Exploitation Case (i.e. the Morgan Stanley & Ami Forte case)

Senior couple meeting real-estate agent for investment.

The attorneys of Investment Loss Recovery Group are currently investigating elder exploitation cases against all financial institutions, including but not limited to, FINRA broker-dealer firms. FINRA arbitration awards that contain Elder Abuse and/or Exploitation findings are very rare, but we believe such findings will increase as the aging of our population continues.

One significant FINRA Award however stands out against Morgan Stanley and its former financial consultant, Ami K. Forte, who was registered as a broker and investment advisor with Morgan Stanley from January 2000 through April 2016. In March 2016, Morgan Stanley, Ms. Forte and then Branch Office Manager, Terry McCoy, were found liable for, amount other claims, elder exploitation (violation of Fl. Stat. 415). The Claimants in that case were awarded $34.3 million.

In December 2018, The Financial Industry Regulatory Authority (FINRA) filed its own complaint against Ms. Forte and her former colleague, Charles J. Lawrence, alleging that they engaged in unsuitable trading and unauthorized trading in the accounts of an elderly customer during a period when he suffered from severe cognitive impairment. In June 2018, Mr. McCoy, who was the branch office manager and a named Respondent in the March 2016 case, was barred from the industry by FINRA and sanctioned $75,000 for failing to supervise (FINRA Case. No. 2016049321301.

Subsequent to the March 2016 Arbitration Award and before FINRA’s actions against Mr. McCoy and. Ms. Forte, new FINRA rules specifically related to Elder Abuse and Exploitation became effective in February 2018.

FINRA Rule 4512: requires members to make reasonable efforts to obtain the name of and contact information for a trusted contact person upon the opening of a non-institutional customer’s account or when updating account information for a non-institutional account. The trusted contact person is intended to be a resource for the member in administering the customer’s account, protecting assets and responding to possible financial exploitation.

FINRA Rule 2165: permits, under FINRA rules, a member that reasonable believes that financial exploitation has occurred, is occurring, has been attempted or will be attempted to place a temporary hold on the disbursement of funds or securities from the account of a specified adult customer. Specified adults include a natural person age 65 and older or a natural person age 18 and older who the member reasonably believes has mental or physical impairment that renders the individual unable to protect his or her own interests.

At Investment Loss Recovery Group, our lawyers bring more than 40 years of combined legal experience and an extensive background in the financial services industry to the clients that we serve. Moreover, specific to elder abuse and exploitation issues, Mr. Thibaut currently serves on the Elder Law Section of the Florida Bar and has lectured on this topic. We work with investors throughout the country to seek the recovery of their investment losses through litigation, arbitration, negotiation, mediation and settlement. If you or a loved one were exploited and lost money with Morgan Stanley, Ms. Forte or any other financial institution, call or reach us online today. We will provide a free review of your case and help you to pursue all of your legal options.

Who Is Ami K. Forte?

You can find information about Ami K. Forte (CRD# 2457536) through two databases which are available online and accessible by the public the FINRA Central Registration Depository (CRD) and Investment Adviser Registration Depository (IARD). Based on Ms. Forte’s FINRA BrokerCheck Report and her IARD Public Disclosure Report:

Ms. Forte has worked in the financial services industry since May 1994. For most of her career, January 2000 through April 2016, she was a registered broker and investment advisor with Morgan Stanley and its predecessor firms located in Palm Harbor, Florida. In 2001, she established The Forte Group at Morgan Stanley and served as its Senior Vice President.

In April 2016, Morgan Stanley terminated her registration due to alleged misconduct that led to a $34,387,777.97 FINRA arbitration award referenced above, as well as the above-mentioned complaint that , FINRA filed in December 2018.

Prior to joining Morgan Stanley, Ms. Forte worked with Prudential Securities Inc. (May 1994 to May 1995) and Smith Barney Inc. (May 1995 to May 1997), both in New York City, as well as Barnett Investments, Inc., in Jacksonville, Florida (April 1997 to April 1998) and Banc of America Investment Services, Inc., in Boston (April 1998 to January 2000). After Morgan Stanley fired her, Ms. Forte was registered through Pinnacle Investments, LLC, in Syracuse, New York, from March 2018 to October 2018. Currently, she is not registered as broker or investment advisor.

FINRA Arbitration Award

In February 2013, the widow of Home Shopping Network co-founder Roy M. Speer, serving as the personal representative of his estate, filed a complaint against Morgan Stanley and Ms. Forte (FINRA No. 13-00549). The complaint requested more than $474 million in compensatory and punitive damages as well as costs and fees. The complaint sought the damages on grounds that included unsuitable trading, unauthorized trading, churning, negligence and negligent supervision as well as breach of fiduciary duty/constructive fraud and unjust enrichment. In March 2016, after an extensive FINRA arbitration proceeding which involved 142 hearing sessions, the arbitration panel awarded in excess of $34 million to the Speer estate.

FINRA Disciplinary Action

In the December 2018 complaint against Ms. Forte (FINRA No. 2016049321302), FINRA alleges that she and Mr. Lawrence (CRD# 3131566) exploited a 79-year-old customer during a period between September 2011 and June 2012 when the customer suffered from severe cognitive impairment. FINRA identifies the customer as “RS.” Ms. Forte began a romantic relationship with RS in the late 1990s and occupied a “position of trust and confidence” with him until his death in mid-2012, according to FINRA.

The complaint states that Ms. Forte and Mr. Lawrence knew of the customer’s cognitive impairment, but they failed to report it to Morgan Stanley. Instead, during the 10-month period, they increased activity in his accounts, making more than 2,800 trades and generating more than $9 million in commissions. Many of those transactions involved unsuitable short-term trading of long-term investments such as income-producing bonds with long-term maturity dates, according to FINRA.

According to FINRA, Mr. Lawrence entered most of The Forte Group’s day-to-day trades in the customer’s accounts. However, Ms. Forte had overall responsibility for the trading strategy and day-to-day trading.

The customer’s accounts generated roughly 94 percent of Ms. Forte’s commission revenue and allowed her to garner the No. 1 ranking on Barron’s Top 100 Women Financial Advisors list from 2010 to 2012, FINRA states. Mr. Lawrence earned a salary ranging from $100,000 to $150,000 and received annual bonuses as high as $200,000, according to the FINRA complaint.

How Can You Recover Investment Losses Involving Ms. Forte?

Since the implementation of FINRA’s new rules described above, many FINRA member broker dealers have implemented internal policies, procedures and training to address elder exploitation issues. The attorneys of Investment Loss Recovery Group concentrate on fighting financial fraud and negligence, including protecting the rights of elderly investors who fall prey to unscrupulous brokers. We work hard to hold brokers accountable for their misconduct as well as brokerage firms that fail to uphold their duty to supervise the conduct of their employees.

Our attorneys, Jason S. Haselkorn and Matthew N. Thibaut, both have a background as licensed securities brokers and as defense counsel for Wall Street brokerage firms. They have learned the industry from the inside out. They use that knowledge every day to pursue the maximum recovery of their clients’ losses, whether it is through litigation, arbitration or settlement negotiations. Through the years, we have worked with clients from across the country.

If you or a loved one was exploited and suffered financial losses after working with Ami K. Forte and Morgan Stanley in Palm Harbor, Florida, we will aggressively protect your rights. Call or reach us online today to learn more and discuss your case in a free and confidential consultation.

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