Ex-Wells Fargo, LPL Rep Gets 3.5 Years in Prison for Stealing $626K From Clients

The former broker for Wells Fargo and LPL Financial who pleaded guilty in February to stealing more than $600,000 from five older clients to fund his gambling and personal expenses was sentenced to 42 months in prison earlier this week, according to court documents and Philip R. Sellinger, U.S. Attorney for the District of New Jersey.

The sentence was handed down to Mario E. Rivero Jr., 39, of Elizabeth, New Jersey, in U.S. District Court for the District of New Jersey in Newark by Judge Madeline Cox Arleo. Rivero was also sentenced to three years of supervised release.

Rivero had pleaded guilty to one count each of wire fraud and securities fraud as part of the plea agreement.

In a separate complaint filed by the Securities and Exchange Commission in the same New Jersey court, the SEC had alleged Rivero "fraudulently misappropriated at least $680,000 from investment accounts that he handled, including accounts owned by elderly and/or disabled investors" from about May 2010 to September 2020.

According to documents filed in the criminal case and statements made in court, from April 2018 to November 2020, Rivero, while serving as a broker, misappropriated about $626,500 from five clients who were all over 65 years old.

"Victim-1" was a resident of Irvington, New Jersey, while Victim-2, Victim-3 and Victim-4 were family members and residents of Newark; and Victim-5 was a resident of Hillside, New Jersey or the State of Alabama, according to the information that Sellinger filed against Rivero.

Rivero "purported to provide investment advisor services" to his victims, Sellinger had alleged. That was despite Rivero not being a registered advisor.

The former broker, who had been entrusted to manage client funds responsibly, instead perpetrated a scheme to defraud several clients. He obtained his clients' money under the fraudulent pretense that he would invest their funds. But Rivero instead unlawfully diverted the funds to enrich himself and others, the Justice Department had charged.

Initially, the Justice Department had filed a complaint against Rivero in March 2022 that charged him with two counts of wire fraud, one count of investment advisor fraud and one count of securities fraud.

The wire fraud and security fraud counts each carried a maximum potential penalty of 20 years in prison and maximum fines of $1 million and $5 million, respectively, Sellinger said at the time.

Rivero became a broker for Wells Fargo Clearing Services in 2010, according to his report on the Financial Industry Regulatory Authority's BrokerCheck website.

Rivero was with Wells Fargo until Oct. 1, 2020, when the wirehouse filed a Form 5 termination notice stating he voluntarily resigned, according to a FINRA letter of acceptance, waiver and consent that he signed in May 2021 without admitting or denying any of the findings. However, he consented to be barred from associating with any FINRA member firm to settle the dispute.

On April 22, 2021, Wells Fargo had filed an amended Form U5, stating it had initiated an internal review concerning allegations made by two former clients of Rivero, according to FINRA.

After leaving Wells Fargo and before being barred, he served as a broker and representative for LPL.

The wirehouse said in a statement provided to ThinkAdvisor on Friday: "At Wells Fargo we hold our employees to the highest ethical standards. Wells Fargo brought Mr. Rivero's conduct to the attention of law enforcement, and we have reimbursed affected clients."

LPL did not immediately respond to a request for comment.

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