American Portfolios Financial Services Cited After Assistant Kimberly Sredich's Theft from Clients & Rep Mark Hopkins' Misappropriation, $1 Million SEC Case

Attorney Advertising Disclaimer

FINRA fined and censured American Portfolio Financial Services for supervision failures and deficiencies that enabled sales assistant Kimberly Sredich to convert $390,000 of customer funds. The clients who lost money tended to be elderly, with one 78-year-old victim losing more than $166,000.

Meanwhile, FINRA barred former American Portfolio broker Mark Lewton Hopkins (CRD #265473) after an investigation into allegations he accepted customer funds for an unapproved investment and conducted outside business activities without proper disclosure.

The related customer dispute on Hopkins' BrokerCheck profile, since settled, indicates Hopkins allegedly utilized the client's funds for his own purposes, instead of for the unapproved investment away from American Portfolios.

While Sredich pleaded guilty to money laundering and conspiracy to commit wire and mail fraud, receiving a federal prison sentence for the crimes, Hopkins remains the defendant in an SEC complaint alleging he misappropriated at least $1.15 million from several American Portfolio customers.

According to the SEC, Hopkins' victims were elderly investors, whose checks were deposited by Hopkins into an account he controlled; the complaint indicates Hopkins provided customers with falsified account statements in furtherance of the allegedly fraudulent scheme.

FINRA's sanction against American Portfolios Financial Services states that the firm violated industry rules by failing to establish and maintain an adequate supervisory system and written supervisory procedures to monitor transmission of customer funds to third parties. FINRA noted that Sredich was able to cause 41 checks worth $340,000 to be issued from 15 customer accounts over a 4-year-period, to an account she and her family controlled.

FINRA wrote that Sredich falsified customer authorization forms and forged customer signatures, and that American Portfolios' lack of an adequate supervisory system led to a failure to detect this conversion for a number of years.

Worse, American Portfolios purportedly had considered adopting a policy related to transmittals from multiple customer accounts to the same third party in the wake of similar misconduct from 2011 that predated Sredich's, which utilized the same methods to convert customer funds. Unfortunately, the firm declined to adopt this new approach toward monitoring transmittals to third parties, even though misconduct had occurred.

If you invested with American Portfolios Financial Services, with former sales assistant Kimberly Sredich, broker Mark Hopkins, or with any other investment adviser or stockbroker whose inappropriate solicitations for investments away from the firm (especially in an unapproved product) or whose conversion or misappropriation has proven harmful to your financial interests, please call an experienced FINRA arbitration attorney at The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for an investigation and consultation.

Categories