Complaints Against Equitable Advisors

Our law firm is investigating customer complaints against Equitable Advisors.  We have experience handling claims related to variable annuities, financial mismanagement, theft and investment fraud.  If you have a complaint regarding Equitable Advisors, please contact our attorneys at (212) 203-9300 for a free and confidential consultation.

Complaint: Equitable Advisors Rep Scams $1.5 Million From Investors

From the early 1990s until mid-2012, Equitable Advisors representative Dennis Wright Dennis Wright misappropriated about $1.5 million from investors, including an elderly woman whose relative later said he “died under extreme stress” caused by the fraudulent scheme. According to federal prosecutors and a report by the Patriot-News, Wright orchestrated his scam by encouraging his clients at Equitable Advisors to cash out their accounts so he could “invest their monies and funds in what he purported to be ‘managed funds.’” Then, instead of investing their funds, he deposited them into a bank account under his own control, spending them on “personal and business expenses.” In order to conceal his scheme, he fabricated account statements for his clients or satisfied withdrawal requests by using other investors’ funds.

Wright, who was based in Central Pennsylvania, reportedly cooperated with an investigation into his activities. and ultimately pleaded guilty to securities fraud. His scheme affected more than 30 victims, “including longtime friends who gave him money to invest for their retirements,” according to Penn Live. The individual who said her husband died under extreme stress because of Wright’s scheme said at a sentencing hearing that Wright’s actions constituted “a bitter blow, a betrayal” to her relative, and asked the judge to give Wright “his just reward for what he did.”

A prosecutor noted that Wright’s cooperation with the investigation helped Equitable Advisors (then AXA Advisors) pay back the majority of his victims. A judge sentenced Wright to more than five years in prison and ordered him to pay restitution of $1.45 million. At his hearing, he reportedly said, “It would be hard to articulate the amount of embarrassment, shame and guilt that I feel.”

Complaint: Equitable Advisors Rep Solicits Friends, Churchgoers to Invest in Fake REIT

Several years before prosecutors charged Dennis Wright with defrauding his clients at Equitable Advisors, authorities uncovered a Ponzi scheme operated by another representative at the firm. Kenneth Neely, who was affiliated with Equitable Advisors’ (then AXA Advisors) office in St. Louis, Missouri was barred by the Financial Industry Regulatory Authority in a 2009 order that found he “fraudulently induced at least 25 customers, family, friends, and fellow church members” to join a fake investment club and invest in a fictitious real estate investment trust.

According to FINRA, Neely hid his Ponzi scheme from his member firms as well as from tax authorities by soliciting his victims to pay their funds to him or his wife in relatively small increments which he immediately converted to cash. He assured his investors they would enjoy high rates of returns and even created a document that represented himself as holding an “ownership interest” in the fake investment club. Over the course of his scheme, which he operated while employed at a succession of broker-dealer firms, he allegedly caused his victims to invest more than $600,000 in the fake REIT, more than half of which he converted to spend on his mortgage and credit card payments, a country club membership, and “extravagant entertainment bills that sometimes exceeded $4,000 a month.”

Neely’s victims included customers at his broker-dealer firms, according to FINRA, whose findings state his first victim was one of his cousins. He allegedly persuaded her to invest about $30,000 in funds she recently inherited from her father, “promising returns of up to 10 percent.” In reality, he converted her “entire investment… for his personal use to pay down his various debts and to support the Ponzi scheme.” Other victims included members of his church, one of whom invested $66,000, of which Neely allegedly converted $36,000 to pay his debts and further the scheme. He also misappropriated a total of $164,000 from a friend and her daughter, according to FINRA, $154,000 of which were his friend’s retirement assets.

FINRA’s findings led the regulator to bar Neely from the securities industry. He was later charged by federal prosecutors with mail fraud, pleading guilty and received a sentence of sentenced 37 months in prison.

Complaint: Equitable Advisors Rep Scams 141 Colorado Schoolteachers

The same year FINRA barred Kenneth Neely, another former Equitable Advisors representative pleaded guilty to defrauding his clients—this time in Longmont, Colorado, where investment adviser Gordon Moore admitted illegally converting almost $1.7 million from 141 Colorado public schoolteachers. According to the Denver Post, he orchestrated his fraud by reaching out to schoolteachers and suggesting they transfer funds from their Public Employees Retirement Association 401(k) accounts into accounts under his control at Equitable Advisors (then AXA Advisors). Prosecutors said that to get around a prohibition on currently employed teachers transferring their retirement funds, “Moore would submit forged documents to PERA indicating that the teachers had been terminated,” ultimately transferring almost $1.7 million in funds from schoolteachers in districts across the state. While he was initially charged on 45 felony counts of securities fraud and other crimes, he pleaded guilty to three counts and was sentences to two years’ probation. Equitable Advisors, meanwhile, agreed to pay a fine of $50,000 over SEC findings that it failed to supervise Moore.

Complaint: Failure to Supervise

In 2007, the Financial Industry Regulatory Authority ordered New York-based broker-dealer Equitable Advisors—formerly known as AXA Advisors—to pay $1.2 million over findings it failed to supervise its fee-based brokerage account program, resulting in the unsuitable placement of almost 2,000 in fee-based accounts.   In 2014, Equitable Advisors agreed to pay $20 million to the New York Department of Financial Services over findings it failed to adequately notify the Department before changing tens of thousands of New Yorkers’ variable annuity policies, limiting their potential returns.  In 2019, FINRA ordered the firm to pay $772,000 over findings that the firm marketed hunk bonds as higher-quality investments. That same year, a FINRA arbitration panel ordered it to pay an award of $3.2 million to an elderly couple who alleged one of its representatives made unsuitable recommendations that reportedly resulted in high commissions for him and losses for them.