A formerfinancial advisor will report to prison on April 12 to serve out a two-year sentence handed down by a California judge this week.
San Fernando Valley-basedadvisor Philip Horn joined Wells’ predecessor Wachovia in 2006 with $125 million in assets under management. But starting in 2009, Horn allegedly began a fraudulent “cancel-and-rebill” order scheme.
According to prosecutors, Horn executed trades in clients’ accounts and if the securities rose in value, he cancelled and “corrected” the orders, directing the profits to his own accounts.
Horn’s suspicious behavior triggered red flags at the firm, which then undertook a forensic analysis of the clients accounts managed by Horn. The firm terminated the advisor in October 2011 and promptly repaid the more than $900,000 Horn improperly pocketed from customers’ accounts. Additionally, Wells Fargo lost $732,000.
“The court thoroughly reviewed the facts and Wells Fargo believes it acted appropriately in the resolution of the issues presented to it,” a firm spokeswoman said.
Per a plea agreement reached in September 2012, Horn has already paid more than $1 million in restitution to Wells Fargo, satisfying his criminal restitution and addressing some of the civil liabilities owed to the firm.
Because Horn turned himself in and cooperated with authorities, prosecutors asked for only an 18-month sentence. But at this week’s hearing, Judge Gary A. Feess sentenced Horn to a 24-month sentence and barred Horn from any future employment with a financial institution insured by the FDIC.