Herbert H. Hafen (also known as Elias Herbert Hafen, Elias Niggebrugge, and E. Herbert Niggebrugge), of New York, New York, a stockbroker formerly registered with Morgan Stanley Smith Barney, is referenced in a customer initiated investment related written complaint which was settled for $20,000.00 in damages on October 13, 2020, based upon allegations of unsuitable investments recommended by Hafen when he was registered with Morgan Stanley Smith Barney. The complaint alleges that the customer sustained damages in their managed account.

Financial Industry Regulatory Authority (FINRA) Public Disclosure shows that Hafen has been identified in three more customer initiated investment related disputes concerning accusations of his misconduct while employed by Morgan Stanley Smith Barney and Wells Fargo Advisors.

On May 9, 2019, a customer initiated investment related complaint involving Hafen’s activities was resolved for $430,000.00 in damages founded on allegations of the misappropriation of the customer’s funds between July of 2011 and January of 2018 while he was registered with Morgan Stanley Smith Barney.

Hafen is also the subject of a customer initiated investment related written complaint which was settled for $120,000.00 in damages on March 9, 2020, based upon accusations of the customer being defrauded after being told by Hafen to place their retirement funds into a high yield investment between May 10, 2018, and August 21, 2018, during the period that Hafen was associated with Wells Fargo Advisors.

On February 11, 2020, a different customer filed an investment related complaint regarding Hafen’s conduct. They requested $50,000.00 in damages based upon allegations of misappropriation of funds by Hafen between April of 2018 and March of 2018 when he was registered with Morgan Stanley Smith Barney.

Hafen has also been sanctioned by securities regulators. He has been barred from associating with any FINRA member in any capacity founded on accusations that he failed to cooperate with FINRA’s request for information. Case No. 2018059821901 (February 1, 2019).

He was issued an Order to Cease and Desist by the Banking Commissioner of Connecticut based upon findings of Hafen misusing a customer’s funds after convincing them to move IRA funds into outside investments. Case No. CDF-20-8474-S. According to the regulator, Hafen targeted funds in an individual retirement account, which the customer inherited and needed for lifelong support. Hafen allegedly paid his mortgage, personal expenses, and credit card bills with the customer’s funds and told the customer that they had twice the amount of retirement funds than what was available.

Hafen also consented to a civil judgment which enjoins him from committing violations of Securities Exchange Act of 1934 Section 10(b), SEC Rule 10b-5, and Investment Advisers Act of 1940 Sections 206(1) and 206(2). He was barred by SEC from being a stockbroker and investment adviser representative. Case No. 3-19721.

Hafen subsequently received a 30-month prison sentence after pleading guilty to investment adviser fraud. Criminal Action No. 1:19-cr-00637.

Hafen was registered with Morgan Stanley between January 18, 2008, and April 3, 2018, and registered with Wells Fargo Clearing Services between March 29, 2018, and September 13, 2018.

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