Larson represented to an elderly widow that she could earn a higher rate of return by investing her funds in a particular high-interest savings account; at the time, she was not his member firm’s customer. Based on Larson’s recommendation and direction, the elderly widow wrote checks totaling $51,600 payable to the “W.F.G. Fund,” and gave the checks to Larson who, in turn, promptly deposited the checks into a W.F.G. Fund account at a bank. Contrary to Larson’s representations, the W.F.G. Fund was not a high-interest savings account, had no relation to his firm’s affiliate bank, and was a basic checking account that Larson owned and controlled. Within two weeks of the receipt and deposit of the customer’s checks, Larson withdrew $6,000 and transferred $27,800 to his day-trading account (at another broker-dealer) and $17,500 to his credit union account, converting the funds for his own use and benefit without the customer’s knowledge, consent or authorization.
The customer complained to FINRA and others about Larson’s conduct; Larson then returned the funds to her. Larson failed to appear for FINRA on-the-record testimony.