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Ex-Wells Fargo Broker Barred for Churning $666K

By Alex Padalka February 13, 2017

Finra has barred a former Wells Fargo Advisors broker for excessive trading in an elderly client’s accounts, according to documents released by the regulator’s disciplinary actions branch.

Matthew Maczko allegedly churned four accounts owned by a 93-year-old client from January 2009 to April 2016, Finra says. During this time, Maczko made more than 2,800 trades, generating around $666,000 in fees and commissions and losing approximately $397,000 in the accounts, which had an average aggregate value of $3 million, according to the regulator. In addition, Finra says Maczko gave false information to its examiners during testimony, telling them that he had not spoken to two other senior customers after his termination from the firm, while phone records indicated that he had.

Wells Fargo Advisors had terminated Maczko in September over concerns about excessive trading in a customer account, Finra says. Maczko, who’s been a registered representative since 1988, doesn’t have any other disciplinary actions on his record, according to the regulator.

Regulators have been coming after brokers churning client accounts, as well as the firms that employ them.

Last month the SEC charged two former J.D. Nicholas brokers for churning 27 client accounts, on the same day it issued a risk alert about the practice.

In October a Finra panel barred Newport Coast Securities and two of its former brokers over churning, ordering them to pay close to $2 million in fines and restitution. The same month, the SEC barred a former LPL broker for excessive trading.

In August Finra fined Caldwell International Securities Corp $2 million for failing to supervise its brokers churning clients’ accounts.

And last March, Finra charged a former Craig Scott Capital broker for churning $1.7 million in fees.