Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Thursday, December 16, 2010

SEC Charges Former Wachovia Employees with Defrauding Customers

The SEC filed a civil injunctive action in Charlotte, North Carolina on December 15, 2010, alleging that William K. Harrison (“Harrison”) and Eddie W. Sawyers (“Sawyers”), former employees of Wachovia, defrauded at least forty-two Wachovia brokerage customers of at least $8 million in customer funds between approximately December 2007 and October 2008.  According to the complaint, Harrison and Sawyers, acting under the d/b/a “Harrison/Sawyers Financial Services,” began offering their Wachovia customers an investment opportunity that they misrepresented was guaranteed to make a 35% return, with no risk of loss of principal.  By October 2008, they had depleted the vast majority of the money they had raised from investors.  On October 13, 2008, Harrison submitted to Wachovia a resignation letter in which he confessed to “misdirecting” $6.6 million from seventeen of his Wachovia customers in order to trade online.  He also admitted that he had conducted this online trading without first securing the authorization of these 17 individuals.

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Are you aware of any evidence showing that Wachovia ignored red flags regarding this fraud?

Posted by: Peter J. Berman | Dec 21, 2010 4:03:51 PM

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