After a FINRA investigation and two sets of charges, he has been arrested in two separate cases.
The FINRA Investigation And Ban
Mario Rivero has only one disclosure in his FINRA record that involves a similar investigation, leading to his indefinite and permanent bar from the securities industry. Rivero was a broker and investment advisor at Wells Fargo for a total of nine years, then resigned to join LPL Financial. Wells Fargo originally filed a Form U5 termination form stating that Rivero had voluntarily resigned. However, Wells Fargo amended the Form U5 on April 22nd, 2021. After his move to LPL, Wells Fargo received complaints from two of Rivera’s customers, indicating that he may have misappropriated some of their funds. Rivero remained registered with LPL until 06/04/2021.
FINRA then began an investigation, which included requesting documents and information from Mario Rivero regarding this matter. FINRA made the request on May 3rd, 2021. In a phone call on May 18th, 2021, with FINRA staff, Rivero’s legal counsel acknowledged the receipt of FINRA’s requests, but declined to produce any information or documentation requested at any time. By doing so, Rivero violated several of FINRA’s rules, leading to sanctioning. This sanction included a permanent bar from associating with any FINRA member in all capacities. Rivero signed a letter of Acceptance Waiver And Consent (AWC), and the bar became final on June 4th, 2021.
The SEC’s Charges – Elder Financial Fraud
On March 14th, 2022, the SEC charged Mario Rivero with misappropriating at least $680,000 from his advisory and brokerage clients. Additionally, some of these clients were elderly or were experiencing memory loss. The complaint alleges that between July 2018 and March 2020, Rivero, then a financial advisor at Wells Fargo, convinced at least five of his clients to transfer investment funds to their personal bank accounts. Once those transfers were complete, Rivero then instructed his clients to transfer the funds into multiple separate entities that he was personally involved with, unknown to them. He never disclosed this fact to his clients. They were told that he would invest their funds in the stock market on their behalf. However, many of his clients were over the age of 80, or in some way disabled.
In several instances, Riviera also directed the sale of securities in many victims’ brokerage accounts prior to the fund transfer from the investment account to the bank account. He made these sales so that there would be cash available in the account for Rivera to transfer. Again, he did not disclose this information to the clients. Through these many transactions, Rivera received hundreds of thousands of dollars in unlawfully obtained funds from the Rivero Affiliated Companies. He convinced his clients to make these transfers multiple times, never indicating that he would personally benefit from them. However, according to the complaint, Rivero simply siphoned the money from these entities into his own accounts for personal expenses and gambling debts.
In the case of one elderly investor, Rivero provided them with a falsified account statement for an alleged brokerage account in their name and then another investor’s name. This was to demonstrate to the client that he had invested their funds in the stock market on their behalf as he stated. However, that brokerage account never existed.
The SEC’s action charges Rivero with violating antifraud provisions of multiple federal securities laws and demands a jury trial. The SEC’s petition seeks injunctive relief, disgorgement of ill-gotten gains, prejudgment interest, as well as civil penalties.
The State Of New Jersey Files Its Own Charges of Elder Financial Abuse
Additionally, the US Attorney’s Office for the District of New Jersey also announced that it would be filing its own charges against Rivero in a separate enforcement action. In this parallel criminal action, Rivero was charged with two counts of wire fraud, one count of investment advisor fraud, and one count of securities fraud.
Rivero was arrested on Monday, March 14, 2022, at his home in Red Bank, New Jersey. He faces the potential for millions in fines and more than 40 years in prison.
Did You Invest With Mario Rivero Jr.?
Silver Law Group represents investors in securities and investment fraud cases. Elder financial abuse is on the rise and investors and their families may be able to recover losses due to a financial advisor improperly taking money from a senior or helping others take advantage of an elderly investor, trust or estate.
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.