The Stockbroker, His Wife, 3 Customers, 3 Healthcare Proxies, 1 Trust, and 1 IRA

October 5, 2018

We got a husband stockbroker. We got his wife. We got two family friends who are customers. They both designate the stockbroker as an agent in their health care POAs. The stockbroker's got another friend/customer who designates him as Trust beneficiary. Someone dies. Things get paid. Things don't get disclosed. Forms are not accurately filled in. Things get refunded and re-paid. Brokerage firms and regulators get unhappy. Allegations and accusations get made. Yeah, I know, it all sort of sounds like a Senate confirmation hearing of a proposed Supreme Court Justice. Sort of reminds me of that great Temptations song "Ball of Confusion."

Case In Point

For the purpose of proposing a settlement of rule violations alleged by the Financial Industry Regulatory Authority ("FINRA"), without admitting or denying the findings, prior to a regulatory hearing, and without an adjudication of any issue, Robert Charles Torcivia submitted a Letter of Acceptance, Waiver and Consent ("AWC"), which FINRA accepted. In the Matter of Matthew Robert Charles Torcivia, Respondent (AWC  2015044686701, September 26, 2018).

Torcivia was first registered in 1974 and by 2004, he was registered with FINRA member firm Wachovia Securities, LLC n/k/a Wells Fargo Clearing Services, LLC). In September 2010,
Torcivia resigned from Wells Fargo and thereafter registered with FINRA member firm Ameriprise Financial Services, Inc.

2007: JS and VS POAs

The AWC asserts that in December 2007, Torcivia was designated as a successor agent on two health care Powers of Attorney ("POA") executed by Wells Fargo customers JS and VS, who are characterized in the AWC as "seniors." The AWC states that for over 20 years, Torcivia and his wife had been friends with the couple.  Although Torcivia was aware that the POAs designated him as a "fiduciary," the AWC asserts that he failed to notify Wells Fargo or make any attempt to have himself removed as an agent on the health care POAs.

2010: Ameriprise 

Following Torcivia's 2010 transfer to Ameriprise, JS and VS followed him as customers. At the time of his registration with Ameriprise, Torcivia allegedly failed to notify that firm of his fiduciary designations on the two POAs from 2007. Further, the AWC asserts that on 2010, 2011, and 2013 Ameriprise compliance attestation forms, Torcivia misrepresented that he was not named as a fiduciary.

SIDE BAR: Don't bothering pointing out to me what I already noted; namely, that the AWC inexplicably fails to account for Torcivia's 2012 attestation. 

2014: Torcivia's Wife as VS Beneficiary

The AWC alleges that in January 2014, VS listed Torcivia's wife as the sole beneficiary on VS's Ameriprise IRA account. Yet again, Torcivia allegedly failed to get this beneficiary listing removed; failed to notify his supervisor of the listing; and continued to service VS's account. 

2014: Second VS POA

In February 2014, the AWC asserts that Torcivia was designated as an attorney-in-fact on a third health care POA executed by customer VS. Yet again, Torcivia was allegedly failed to notify Ameriprise of this new fiduciary designation, and continued to service VS's account. 

Ameriprise Rulebook

The AWC asserts that between September 2010 and February 2015, while Torcivia was associated with Ameriprise, the firm had 

policies in place prohibiting representatives or members of their household from being listed as a beneficiary by or inheriting from customers, except in certain limited circumstances not applicable here. These policies further required representatives to attempt to get any such beneficiary listings removed, and to notify their supervisor of the beneficiary listings.

And now, things take that inevitable turn for the worst!

2014: VS Death

In December 2014, VS died.

2015: Torcivia's Wife Receives Distribution

In January 2015, Torcivia's wife received approximately $133,000 from VS's account. 

And then things get a bit less worse.

Pursuant to a request from Ameriprise, in February 2015, Torcivia's wife returned the $133,000 to Ameriprise. 

And then we're asked to consider this unexpected twist, as set forth in the AWC:

Then, in December 2015, after Torcivia was no longer associated with Ameriprise, and subsequent to the resolution of litigation involving Torcivia's wife and other beneficiaries of VS, Torcivia's wife ultimately received the approximately $133,000 from VS's account.

So . . . Torcivia's wife got $133,000 from VS's Ameriprise account but she repaid that amount in full back to Ameriprise but after Torcivia left Ameriprise, his wife received about $133,000 from VS's Ameriprise account following the "resolution of litigation."

As if things weren't confusing enough, now we have to go farther back in time, about a decade in fact.

2005 - 2011: Variation on a Theme with HS

In September 2005, Torcivia was listed as a residual beneficiary on a trust established by "senior" customer HS. The AWC concedes that Torcivia had been friends with HS for many years. Notably, it was only in April 2011, Torcivia learned he had been designated as a beneficiary on HS's trust. When the trust became a customer of Torcivia's at Ameriprise, Torcivia allegedly failed to attempt to get this beneficiary listing removed; failed to notify his supervisor of the listing; and continued to service the trust's account after learning of the designation. 

As you may have expected from the fact pattern in this matter, in June 2011, HS died and while Torcivia was still associated with Ameriprise, he inherited about $30,000 from the trust. The AWC then picks up the trail as follows:

In February 2015, after Ameriprise opened an investigation into Torcivia's fiduciary and beneficiary listings by customers, Torcivia disclosed to Ameriprise his and his wife's fiduciary and beneficiary status concerning customers JS, VS, and HS. During FINRA's subsequent investigation of this matter, however, Torcivia initially withheld that his wife had ultimately retained the money from VS's IRA account, which fact only came to light after additional investigation by FINRA began an investigation into this matter after receiving a Form U5 filed by Ameriprise regarding Torcivia. The Form U5 reported the termination of Torcivia's association with Ameriprise for failures to disclose fiduciary and beneficiary relationships with clients.

FINRA Sanctions

FINRA alleged that an associated person violates NASD Rule 2110 and/or FINRA Rule 2010 when he or she accepts fiduciary or beneficiary designations from customers contrary to the policies of his or her firm. Accordingly, FINRA deemed Torcivia's cited conduct to constitute violations of NASD Rule 2110 (for conduct between December 2007 and December 14, 2008); and FINRA Rule 2010 (for conduct between December 15, 2008 and February 2015). In accordance with the terms of the AWC, FINRA imposed upon Torcivia a $10,000 fine and a 7-month suspension from association with any FINRA member in any capacity.

Bill Singer's Comment

According to online FINRA BrokerCheck records as of October 5, 2018, Ameriprise discharged Torcivia on February 20, 2015, based upon allegations that:


Ummm . . . I dunno . . . not exactly sure how to reconcile FINRA's multiple allegations of misconduct with what comes off as a somewhat puny fine and suspension. By the time I got done with FINRA's presentation of facts, I was fairly certain that Torcivia was going to be barred. Not saying I thought a Bar was deserved but merely sharing my expectation with you.

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