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Edward Jones Wins Fight to Recoup Finra Damages

By Alex Padalka September 6, 2017

A Finra arbitration panel has ultimately ruled in favor of Edward Jones in a claim brought by the estate of a deceased client, ordering a third person to pay back the funds Edward Jones had initially paid to the estate, according to an award statement from Finra’s Office of Dispute Resolution.

The panel has ordered Louis Zemek to pay back the $290,000 the firm had paid as part of a previous settlement to the estate of Margie Gerrard, according to the order. Zemek must also cover up to $50,000 in Edward Jones’s attorney fees.

Zemek had allegedly opened a power of attorney investment account with margin privileges in Gerrard’s name using a forged Edward Jones power of attorney affidavit, according to the award document. Zemek — who is currently in active military service — then allegedly took out the funds on margin for his own personal use, according to Finra. He also allegedly tried to use an indemnification form to free himself from liability in the transactions, according to the award document.

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Gerard’s estate originally sought compensatory damages of $524,000 and lost income or prejudgment interest, punitive damages, attorneys’ fees and lost money paid out in income taxes and penalties, according to Finra. Last February, the estate dismissed all claims against Edward Jones and James Gunn, who has been registered with the firm since 2001, according to his BrokerCheck profile.

The Finra panel denied Edward Jones’ request for expungement as well as Gunn’s monetary claims, but recommended Gunn’s arbitration claim expungement, according to the award document.