The Securities and Exchange Commission (SEC) has taken legal action against a former Cetera representative for allegedly deceiving an elderly client and embezzling over $2.4 million from his brokerage account. The accused, Clarice Saw, manipulated the client into granting her power of attorney before transferring the funds to her personal bank account.
The SEC has requested an injunction against Clarice Saw, prohibiting her from engaging in further securities violations. Additionally, they seek a court order mandating that she reimburse the client and pay a monetary penalty. Clarice Saw has not yet responded to requests for comment.
Citigroup Global Markets disclosed that Clarice Saw first began working with the client in 2020 when she was a registered representative there. The client had recently lost his wife and was left with $1.8 million from life-insurance proceeds. Not being fluent in English and having no immediate family, the client was vulnerable. Taking advantage of their shared ethnic background and language, Saw became deeply involved in the client's life by accompanying him to medical appointments and assuming other responsibilities.
The SEC's determined actions aim to protect vulnerable individuals and ensure justice is served against those who exploit them for personal gain.
The Case of Misused Power-of-Attorney: A Disturbing Tale of Financial Fraud
Saw's first move was to add her name to the client's TD Bank account, utilizing the power-of-attorney agreement. Within two days, she further expanded her control by opening a second TD account, designating herself as the primary owner and the client as the co-owner.
Taking advantage of her newfound access, Saw proceeded to tamper with the client's Cetera account. She introduced a falsified note, deceitfully claiming that the client had decided to liquidate all their holdings due to health-related reasons. This note falsely stated that the funds were intended for donation or distribution.
However, an investigation by the SEC revealed a shocking truth - the client had never expressed a desire to liquidate any positions within their brokerage account. The note, therefore, served as a smokescreen for Saw's illicit intentions.
Unbeknownst to the client, Saw wasted no time in executing her fraudulent scheme. A day after inserting the fabricated note into the client's file, she proceeded to sell approximately $1.7 million worth of stocks from the brokerage account. Without delay, she transferred this substantial sum of money into the first TD account. Shortly after, she made yet another transfer to the second bank account that she controlled.
As if one large-scale fraudulent act was not enough, Saw continued her misconduct. On December 20, 2021, she allegedly sold the remaining $730,000 from the client's brokerage account before diverting it to the bank account under her control.
Tragically, the misused funds served to fulfill Saw's personal expenses, including mortgage payments and car loans. Additionally, she used a portion for personal investments in individual stocks, potentially further enriching herself at the expense of her vulnerable client. Disturbingly, she also indulged in around $46,000 worth of ATM withdrawals.
It is important to note that Saw left her position at Cetera in June 2022. However, regulatory records indicate that she is presently registered as a broker and advisor with Coastal Equities and its affiliated RIA, Coastal Investment Advisors. The parent company of these entities, CoastalOne, declined to provide any comments on this disheartening situation.
This alarming case highlights the urgent need for enhanced safeguards to protect vulnerable individuals from such financial exploitation. It serves as a stark reminder that vigilance and proactive measures are crucial in safeguarding one's financial well-being.
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