Two Ex-Morgan Stanley Brokers in Boston to Plead Guilty to Fraud

Two former Morgan Stanley brokers in Boston who were fired in June on allegations of misappropriating client funds have agreed to plead guilty to federal fraud charges, according to an announcement Wednesday from the U.S. Attorney’s Office in Massachusetts.

James Polese, 51, and his partner Cornelius Peterson, 28, transferred $500,000 out of two client accounts from 2014 to 2017 without the clients’ knowledge or consent, and used the money for a wind farm project, other investments and personal expenses, prosecutors said.

Polese and Peterson were each charged with one count of conspiracy and investment advisor fraud and three counts of bank fraud. Polese was charged with an additional five counts of bank fraud and aggravated identity theft, according to the release.

Polese did not immediately return a call for comment, and Peterson could not be reached for comment.

The brokers withdrew $100,000 from a client account in August 2014 to invest in the wind farm project without authorization by Morgan Stanley, and in May 2015 withdrew $400,000 from another client’s account to support a letter of credit for the project, prosecutors said. In 2017, Polese made multiples withdrawals and transfers from a client account to pay college tuition and credit card bills, among other personal items, according to the announcement. Read More