SEC Announces Enforcement Action Against Former Wells Fargo Advisors Compliance Officer for Altering Document
Judy K. Wolf, a former Wells Fargo Advisors compliance officer, altered a trading review document in December 2012 to falsely appear more thorough after learning the SEC had charged a broker with insider trading, misleading regulators and violating securities laws, leading to her termination and SEC enforcement action.
The SEC charged Judy K. Wolf with willfully altering a compliance document from September 2010 in December 2012 to make it seem she had conducted a more rigorous review of suspicious trading after the SEC charged a Wells Fargo broker with insider trading. Wolf initially denied the alteration but later admitted it during testimony, violating Section 17(a) of the Securities Exchange Act, Rule 17a-4(j), and Rule 204(a) of the Investment Advisers Act by aiding and abetting recordkeeping failures. Wells Fargo previously paid $5 million to settle related violations, and Wolf was terminated after being placed on administrative leave.
Judy K. Wolf, a former Wells Fargo Advisors compliance officer, was responsible for reviewing potentially suspicious trading by firm personnel and clients for signs of material nonpublic information misuse. In September 2010, she completed a review of a broker’s trades with no findings, but in December 2012—after the SEC charged the broker with insider trading—she altered the document to falsely suggest a more thorough analysis had been conducted. When the SEC received the document during its investigation, staff identified inconsistencies and questioned Wolf, who initially denied any post-2010 changes but later admitted to altering it. The SEC alleges Wolf willfully aided and abetted Wells Fargo’s violations of Section 17(a) of the Securities Exchange Act, Rule 17a-4(j), and Rule 204(a) of the Investment Advisers Act by compromising the integrity of regulatory records. Wells Fargo had already settled related violations in 2012 by paying $5 million, and Wolf was placed on administrative leave and subsequently terminated. The SEC’s Market Abuse Unit, led by Daniel M. Hawke and litigated by Donald Searles, is pursuing administrative sanctions against Wolf for conduct deemed a serious breach of compliance obligations. Her actions undermined regulatory oversight and violated the fundamental trust placed in compliance professionals.
Exhibits & Attached Documents (1)
Extracted insights
- $5.00M $5 million $1M–$10M
- scheme_term broker with insider trading
- person Daniel M. Hawke
- agency document before providing to sec
- person donald searles
- person identifying potentially suspicious trading
- person judy k. wolf
- agency sec enforcement division
- agency Securities and Exchange Commission
- person wells fargo
- Securities And Exchange Commission announced enforcement action against Judy K. Wolf
- Judy K. Wolf allegedly altered document before providing to SEC
- Judy K. Wolf was responsible for identifying potentially suspicious trading
- Judy K. Wolf created document in September 2010
- Judy K. Wolf altered document in December 2012
- SEC charged broker with insider trading
- Judy K. Wolf denied altering document after September 2010
- Judy K. Wolf testified she altered the document
- SEC charged Wells Fargo
- Wells Fargo agreed to pay $5 million to settle violations
- Wells Fargo placed Judy K. Wolf on administrative leave
- Wells Fargo terminated Judy K. Wolf's employment
- Daniel M. Hawke said Wolf intentionally altered trading review document
- SEC Enforcement Division alleged Wolf willfully aided and abetted violations
- SEC Enforcement Division investigated case conducted by Megan Bergstrom and David S. Brown
- Donald Searles will lead litigation
The Securities and Exchange Commission today announced an enforcement action against a former Wells Fargo Advisors compliance officer who allegedly altered a document before it was provided to the SEC during an investigation. According to the SEC’s order instituting an administrative proceeding against Judy K. Wolf, she was responsible for identifying potentially suspicious trading by Wells Fargo personnel or the firm’s customers and clients and then analyzing whether the trades may have been based on material nonpublic information. Wolf created a document in September 2010 to summarize her review of a particular Wells Fargo broker’s trading, and she closed her review with no findings. The SEC Enforcement Division alleges that Wolf altered that document in December 2012 after the SEC charged the broker with insider trading. By altering the document, Wolf made it appear that she performed a more thorough review in 2010 than she actually had. After Wells Fargo provided the document to the SEC as part of its continuing investigation, SEC enforcement staff spotted the alteration and questioned Wolf specifically about the document. At first she unequivocally denied altering the document after September 2010, but in later testimony she testified that she had done so. The SEC previously charged Wells Fargo in the case, and the firm agreed to pay $5 million to settle these and other violations of the securities laws. Prior to the enforcement action, Wells Fargo placed Wolf on administrative leave and ultimately terminated her employment. “We allege that Wolf intentionally altered a trading review document after she knew that the SEC had charged a Wells Fargo employee with insider trading based on facts related to her review,” said Daniel M. Hawke, Chief of the SEC Enforcement Division’s Market Abuse Unit. “Regardless of her motivation, her conduct was inconsistent with what the SEC expects of compliance professionals and what the law requires.” The SEC Enforcement Division alleges that Wolf, who lives in St. Louis, willfully aided and abetted and caused Wells Fargo to violate Section 17(a) of the Securities Exchange Act of 1934 and Rule 17a-4(j) as well as Rule 204(a) under the Investment Advisers Act of 1940. The SEC Enforcement Division’s investigation was conducted by Megan Bergstrom and David S. Brown of the Market Abuse Unit. The case was supervised by Mr. Hawke, Robert A. Cohen, and Diana Tani. The litigation will be led by Donald Searles.
The Securities and Exchange Commission today announced an enforcement action against a former Wells Fargo Advisors compliance officer who allegedly altered a document before it was provided to the SEC during an investigation. According to the SEC’s order instituting an administrative proceeding against Judy K. Wolf, she was responsible for identifying potentially suspicious trading by Wells Fargo personnel or the firm’s customers and clients and then analyzing whether the trades may have been based on material nonpublic information. Wolf created a document in September 2010 to summarize her review of a particular Wells Fargo broker’s trading, and she closed her review with no findings. The SEC Enforcement Division alleges that Wolf altered that document in December 2012 after the SEC charged the broker with insider trading. By altering the document, Wolf made it appear that she performed a more thorough review in 2010 than she actually had. After Wells Fargo provided the document to the SEC as part of its continuing investigation, SEC enforcement staff spotted the alteration and questioned Wolf specifically about the document. At first she unequivocally denied altering the document after September 2010, but in later testimony she testified that she had done so. The SEC previously charged Wells Fargo in the case, and the firm agreed to pay $5 million to settle these and other violations of the securities laws. Prior to the enforcement action, Wells Fargo placed Wolf on administrative leave and ultimately terminated her employment. “We allege that Wolf intentionally altered a trading review document after she knew that the SEC had charged a Wells Fargo employee with insider trading based on facts related to her review,” said Daniel M. Hawke, Chief of the SEC Enforcement Division’s Market Abuse Unit. “Regardless of her motivation, her conduct was inconsistent with what the SEC expects of compliance professionals and what the law requires.” The SEC Enforcement Division alleges that Wolf, who lives in St. Louis, willfully aided and abetted and caused Wells Fargo to violate Section 17(a) of the Securities Exchange Act of 1934 and Rule 17a-4(j) as well as Rule 204(a) under the Investment Advisers Act of 1940. The SEC Enforcement Division’s investigation was conducted by Megan Bergstrom and David S. Brown of the Market Abuse Unit. The case was supervised by Mr. Hawke, Robert A. Cohen, and Diana Tani. The litigation will be led by Donald Searles.