Do You Have Losses From Investing With Broker Clyde Jensen?

Clyde Jensen (Clyde Anthony Jensen CRD:#5658476) is a registered broker and investment advisor whose last known employer was TD Private Client Wealth LLC (CRD#:164484) of Tampa, FL. His previous employers include Woodstock Financial Group, Inc. (CRD#:38095) of Valrico, FL, Ameriprise Financial Services, Inc. (CRD#:6363) of Fort Meyers, FL, and Morgan Stanley (CRD#:149777) of Tampa, FL. He has been in the industry since 2009.

While employed with Ameriprise, a client in her 90s notified Jensen that she wanted him to be the beneficiary of her trust. The trust consisted of nine securities, and at the time was worth $600,000.

When Jensen notified his supervisor, the supervisor informed him that the firm’s rules prohibited him and/or his family members to become beneficiaries of a client’s estate. He did so anyway, meeting with the client and her attorney, successor trustee and primary beneficiary of the client’s trust to make Jensen the primary beneficiary and his children as the contingent beneficiaries. Jensen failed to notify Ameriprise, and falsely claimed on compliance documentation that he was not a beneficiary for anyone’s estate.

Jensen attempted to file a Transfer on Death (TOD) form for the client, which named him as the beneficiary. His supervisor notified him that the form could not be processed because it would create a beneficiary relationship prohibited by the firm. Jensen managed the client’s account until her death on July 10, 2018. The account was worth over $833, 735.35 at the time of her passing.

Shortly thereafter, Jensen attempted to have the shares transferred, but the firm denied the transfer. On August 6, 2018, Jensen resigned from Ameriprise. In September of 2018, a trustee liquidated the nine securities, and the funds were then in money market funds at the firm.

In the months before, Jensen falsely attested on a compliance form that he nor any family members would not receive any financial proceeds from any Ameriprise client and would notify the firm if he became aware of such a designation. He falsely attested because he already knew that he would be a beneficiary, with his children as contingent beneficiaries.

Following a disciplinary action, FINRA suspended Jensen for six months and fined him $10,000, with the fine to be paid prior to re-association with a FINRA broker dealer.

Broker Beneficiaries And FINRA Rule 3241

Many investment clients appreciate the work that their brokers do for them and want to show their appreciation. But making your broker a beneficiary or trustee in your estate plan is not a good idea and can cause considerable legal problems for the broker after your death. Unless your broker is an immediate family member, it is not advisable to make them a part of your estate planning.

We’ve written about this issue before, and made our comments on the subject known to FINRA last year. In it, we detailed the case of one elderly client in which her son was excluded from the will in favor of her financial advisor.

Most FINRA member broker-dealer firms have policies prohibiting brokers from knowingly becoming beneficiaries in a customer’s will, trust, or estate plan unless they are immediate family. Even then, the broker must provide disclosure to the firm as part of their yearly compliance.

Should a broker become aware that a client has made them a beneficiary, the firm requires them to disclose this information immediately. In Jensen’s case, the firm disallowed both the broker and any family member of the broker from being a beneficiary. He failed to notify the firm and resigned from the firm to circumvent those rules.

Last year, FINRA adopted a new rule that prohibits brokers from becoming beneficiaries, trustees, or executors by their clients. It directly addresses the conflict of interest that can arise when a broker collaborates closely with a client, and the possibility of undue influence by the broker. Unless that client is also a family member, FINRA prohibits both the broker and their own relatives (spouse, children, etc.) from being named as a beneficiary in their will.

FINRA’s new Rule 3241 directly addresses the issue, and goes beyond the rules most firms have in place. The rule establishes national standards that go beyond the different rules that govern most firms.

Did You Invest With Clyde Jensen?

Silver Law Group represents investors in securities and investment fraud cases. Our lawyers are admitted to practice in New York and Florida and represent investors nationwide to help recover investment losses due to stockbroker misconduct. If you have any questions about how your account has been handled, call to speak with an experienced securities attorney. Most cases are handled on a contingent fee basis, meaning that you won’t owe us until we recover your money for you. Contact us today at (800) 975-4345 and let us know how we can help.