Ex-Morgan advisor guilty of spending $1.6M of clients’ money on art, men’s accessories

Former Morgan Stanley advisor Elias Herbert “Bert” Hafen faces up to five years in prison after pleading guilty to stealing $1.6 million from his clients to fund his own “lavish” lifestyle.

Hafen, 64, of New Canaan, Connecticut, is “every client’s worst nightmare,” according to the SEC. The veteran advisor, who started his career in 1979, convinced clients to transfer money into his own personal bank account by telling them they were investing in a high-yield investment fund with guaranteed returns.

To support his ruse, he created fictitious investors’ statements bearing the name of a non-existent investment company, according to a release from the U.S attorney’s office for the Southern District of New York, which brought criminal charges against him in a parallel case.

“In reality, however, there was no investment fund at all,” the commission said in a statement. Instead, “Hafen was using the victims’ funds to pay for a lavish lifestyle including custom men’s accessories and an expensive collection of artwork.” He also used funds to cover expenses for his house, car and credit card bills for himself and family members.

Source: On Wall Street

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