Mahoud Elawadi, of Orlando Florida, a stockbroker formerly registered with Wells Fargo Clearing Services is the subject of a customer initiated, investment related “complaint” against Wells Fargo seeking to be reimbursed $1.5 million the investor lost “investing” into a business owned by Elawadi.
Tales of stockbrokers inducing customers to invest in some business in which the financial advisor has an interest range from outright theft to the sale of unregistered securities. It is never a good idea, and generally, each year registered stockbrokers (and associated persons) are required to complete, and the securities broker-dealer is required to supervise, the stockbroker’s affirmation of outside business activities, and whether they are investment related, whether they involve “customers,” in an effort to detect or prevent “private securities transactions,” which in the less legal jargon is commonly referred to as “selling away.”
Very often, friends, and family members, including immediate and extended family members of any financial advisor, may have, or have had a securities account at the broker-dealer firm. It does not matter, other than a narrow exceptions for loans from family members, (which also require disclosure to the member firm), everyone is a “customer.”
Now, what about “investing”? Did the financial advisor use his or her position of trust and confidence to induce an unsophisticated, or even sophisticated, customer to “invest” in some scheme, in which the wayward financial advisor (and sometimes the financial advisors’ mother) proclaimed a personal interest. May seem dated, but the definition of a security (or even an investment in this context) would require (a) the investment of money; (b) with the expectation of profits; (c) solely from the efforts of others. (“the Howey test”).
What if the customer had an active role in the operation of a business that sold sea shells by the sea shore, or the customer was merely a partner, or family member, who just also happened to have an account with the brokerage firm? Heads I win, tails you lose. Wells Fargo is the insurer of the customer’s business ventures.
Here, it also appears that financial advisor, at least according to FINRA Public Disclosure, reported several outside business activities, which were disclosed or ostensibly approved by Wells Fargo. Where there any red flags? Was the “business” in which the “customer” invested one of these entities?
We do not know, and since no formal FINRA securities arbitration claim has been filed in this matter, let alone proceed to a final hearing, we may never know. However, we do know, at least according to FINRA Public Disclosure that Wells Fargo received the complaint on November 25, 2025, and Elawadi was terminated less than thirty days later on December 22, 2025.
Given the foregoing, we would expect FINRA to investigate pursuant to Rule 8210, would require the financial advisor to cooperate with any regulatory inquiry by FINRA.
The Guiliano Law Group, P.C.
For more than thirty years, our practice is limited to the representation of investors. We accept representation on a contingent fee basis, meaning there is no cost to you unless we make a recovery for you. There is never any charge for a consultation or a confidential evaluation of your claim. For more information, contact us at (877) SEC-ATTY.
If you believe that you have been the victim of misconduct or fraud, contact us for a free consultation. We handle all cases on a contingency fee basis meaning that there is no cost or obligation, unless we are able to make a recovery for you.
