Michael Barry Carter (also known as Mike Carter), of McLean, Virginia, a stockbroker registered with Morgan Stanley, has been barred by Securities and Exchange Commission (SEC) from being a stockbroker or an investment advisor representative based upon allegations that Carter misappropriated funds. In the Matter of Michael Barry Carter, Order Instituting Administrative Proceedings, Administrative Proceeding File No. 3-20386 (July 2, 2021).
Prior to the Order, SEC filed a Complaint against Carter alleging misappropriation of approximately $6,000,000.00 from Carter’s customers between October of 2007 and May of 2019. Carter used false forms to effect 60 wire transfers. Also, prior to the Order, Carter pled guilty to federal wire fraud and investment advisers fraud charges. United States v. Michael Barry Carter, Criminal Action No. 20-cr-151.
The Commission’s complaint alleged that from approximately October 2007 through May 2019, Carter misappropriated approximately $6 million from brokerage customers and an elderly investment advisory client while he served as their financial advisor at Financial Institution A. The complaint alleged that Carter carried out his scheme by falsifying internal forms to effect approximately 60 unauthorized cash wire transfers from the customers’ and client’s accounts to his personal bank account at another financial institution. On March 29, 2021, a judgment in the criminal case was entered against Carter. He was sentenced to a prison term of 60 months followed by three years of supervised release and ordered to make restitution in the amount of $4,355,110.39.
Carter has been barred from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity because Carter failed to provide information and documents to FINRA during the time that it investigated possible violations of FINRA rules. Letter of Acceptance, Waiver, and Consent No. 2019063523501 (September 9, 2019).
According to the AWC, on August 9, 2019, FINRA sent a request to Carter for the production of information and documents. FINRA sent a second request to Carter on August 20, 2019. On August 27, 2019, through his counsel, Carter indicated that he had received FINRA’s request but would not produce the requested information and documents. Therefore, Carter violated FINRA Rules 2010 and 8210.
On December 15, 2020, Carter was barred as a stockbroker in the state of Maryland based upon allegations that Carter misappropriated funds. Maryland Enforcement Action No. 2019-0176.
FINRA Public Disclosure reveals that Carter has been identified in five customer initiated investment related disputes concerning allegations of Carter’s conduct while associated with Morgan Stanley. Carter was referenced in a customer initiated investment related complaint that was settled on September 12, 2019, for $676,174.01 in damages based upon allegations that the customer did not know about withdrawals in their account when Carter was associated with Morgan Stanley Smith Barney.
Morgan Stanley appears to have repaid these investors.
On October 18, 2019, a different customer initiated investment related complaint involving Carter’s conduct was settled for $3,193,500.00 in damages based upon allegations that Carter made unauthorized withdrawals from the customer’s account.
Carter was the subject of a complaint that was settled on February 28, 2020, for $1,300,000.00 in damages based upon allegations that Carter misappropriated funds. He was also referenced in a complaint that was settled on June 26, 2020, for $16,731.00 in damages based upon allegations of misappropriation.
Carter was associated with Morgan Stanley in McLean, VA, as a stockbroker from December of 2011 to August of 2019. On July 30, 2019, Morgan Stanley Wealth Management discharged Carter based upon allegations that Carter misappropriated funds.
