A former Fidelity Investments broker in Jacksonville, Florida, was sentenced last week to 80 months in federal prison for defrauding a 75-year-old client out of more than $2 million. Eric J. Stone, 43, pleaded guilty in March to wire fraud and money laundering charges, according to the U.S. Attorney's Office for the Middle District of Florida.
Stone was also ordered to pay $2 million in restitution to the victim. The sentencing, handed down by U.S. District Judge Brian J. Davis, caps a case that underscores the severe consequences for advisors who violate the industry's strict prohibition on borrowing from clients.
According to court documents, Stone cultivated a friendship with the victim over approximately three years, convincing her to make more than 600 transactions totaling over $2 million. He used fraudulent emails purportedly from attorneys, banks, and other sources to persuade her to send money, which he then largely spent on foreign gambling websites.
Stone's BrokerCheck record shows he was registered with Fidelity Brokerage Services in Jacksonville from 2008 until his discharge in 2021. Fidelity's termination notice cited "loans employee solicited and obtained from clients." A Fidelity spokesperson declined to comment on the case.
The victim has also filed a customer arbitration claim against Fidelity seeking $2.7 million in damages, alleging she loaned money to Stone and has not been fully repaid. The claim notes that $30,000 in loans were made before Stone's termination.
Financial Industry Regulatory Authority (FINRA) rules explicitly bar advisors from borrowing money from customers, with exceptions for certain family members or lending institutions. Violations can lead to suspensions, fines, or permanent bars from the industry.
The case echoes a recent FINRA settlement involving Jacob Lee Harper, a former LPL Financial advisor. Harper consented to a nearly two-year suspension and a fine after FINRA found he borrowed $20,000 from one client in November 2024 and $30,000 from another in January 2025, without his employer's knowledge. Harper neither admitted nor denied the findings, but LPL had already terminated his registration.
Industry observers note that such cases highlight the importance of robust compliance oversight, particularly when dealing with vulnerable senior clients. Proposed FINRA rules aim to strengthen protections for older investors, including longer holds on suspicious transactions.
Stone's sentencing is the latest in a series of fraud cases involving former brokers. Another ex-broker was recently sentenced to two years for a $600,000 investor fraud, and Stifel paid $3.6 million to settle claims tied to a former broker. These cases serve as a reminder of the reputational and financial risks that firms face when advisors breach trust.
For advisors, the lesson is clear: any deviation from FINRA's borrowing rules can lead to criminal prosecution, industry sanctions, and permanent career damage. For investors, the case underscores the importance of verifying an advisor's background and reporting any suspicious requests for loans or transfers.
