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FINRA Sanctions Former Morgan Stanley Broker Over Unauthorized Transfers

Posted on December 3rd, 2025 at 2:40 PM
FINRA Sanctions Former Morgan Stanley Broker Over Unauthorized Transfers

From the desk of Jim Eccleston at 麻花传媒

A longtime Morgan Stanley financial advisor agreed to a $5,000 fine and a two-month suspension after FINRA found that he executed multiple transfers from his former spouse’s retirement account without proper authorization, as reported by AdvisorHub.

According to the FINRA Acceptance, Waiver and Consent (AWC), Michael J. Schmidt moved at least $13,543 between March 2020 and June 2022 from his then-wife’s IRA into a joint brokerage account through 15 unauthorized transfers. FINRA stated that Schmidt used the funds to cover joint household expenses. AdvisorHub reports that the regulator also noted that Schmidt documented false claims of authorization “on a particular date and at a particular time,” even though he did secure proper approval for at least 11 other transfers during the same period.

According to AdvisorHub, Schmidt represented himself during the FINRA proceedings. He has not been registered since Morgan Stanley terminated his employment in January 2024 for activity involving a family member’s account.

 

麻花传媒 LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.

Tags: eccleston, eccleston law, finra, morgan stanley

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