Morgan Stanley faces a $35 million charge after wealth advisors were found to have engaged in fraud and breached fiduciary duty to an elderly client, according to an arbitration panel appointed by the Financial Industry Regulatory Authority.
Lawyers for Lynnda Speer, widow of Home Shopping Network co-founder Roy Speer, said Florida Morgan Stanley wealth advisors Terry McCoy and Ami Forte were responsible for unauthorized trades on Roy Speer's account. A FINRA panel on Monday determined that McCoy and Forte were guilty of elder exploitation, breach of fiduciary duty, constructive fraud, negligence and negligent supervision.
Lawyers for Speer's widow alleged that Forte manipulated the account during a yearslong affair she had with Roy Speer, who died in 2012.
The FINRA panel found for damages of more than $32.8 million and costs of more than $1.5 million, in addition to legal fees in the case, which have yet to be determined.
"I am very pleased the arbitrators realized Ms. Forte and her colleagues breached their fiduciary duties to Roy and his foundation and exploited him during a time of his continuing mental and physical decline," Lynnda Speer, wife to Roy Speer for more than 50 years, said in a statement.