A Tarzana-based investment adviser was handed a two-year federal prison sentence Monday for his role in an investment scheme in which he stole nearly $1 million in profits from trades executed on his clients' behalf.
Philip D. Horn, a former managing director at the Westwood Village branch office of Wells Fargo Advisors (WFA) and formerly a licensed securities broker, pleaded guilty last September to a pair of wire fraud counts.
Horn admitted that he engaged in a scheme in which he obtained more than $730,000 through a series of trades that were initially executed in the accounts of clients that he managed and, if the trades proved to be profitable, were fraudulently "corrected" to remove the trades from the clients' accounts and "re-billed" to Horn's own accounts, prosecutors said.
Further review of Horn's activities by forensic accountants retained by WFA to investigate the full extent of his activities showed other types of phony "correction" orders, including transferring unprofitable trades in his own account to the accounts of customers, court papers show.
Horn, 51, executed the fake orders between April 2009 and October 2011, when he was fired by WFA.
WFA undertook a forensic analysis of all accounts impacted by Horn's scheme and, according to court filings, has repaid money improperly taken from customer accounts.
For his part, Horn has paid more than $1 million in restitution, officials said.