Former Financial Advisor Charged with Stealing from Clients

OAKLAND, CA—A former financial advisor for the United Bank of Switzerland Financial Services, Inc. (UBS) was charged today with wire fraud and money laundering related to a fraudulent scheme to obtain money from his clients, United States Attorney Melinda Haag announced.

According to the criminal information, between April 2006 and August 2009, Steven Kobayashi, who worked in UBS’s Walnut Creek, California office, made unauthorized wire transfers from his clients’ UBS accounts into several Bank of America accounts that he maintained. At times, Kobayashi, of Livermore, California, received the authority of the UBS clients to transfer the funds to his bank accounts based on his false representations to the UBS clients that the transfers were required to invest their funds. At other times, Kobayashi forged or copied and pasted the signatures of his UBS clients on documents authorizing the transfer of the funds from the clients’ UBS accounts to Kobayashi’s bank accounts.

Also included in the criminal information is a forfeiture allegation. Upon conviction of the wire fraud offense, the forfeiture allegation would require Kobayashi to forfeit to the United States all property derived from proceeds traceable to the wire fraud.

The maximum statutory penalty for a violation of Title 18, U.S.C § 1343, wire fraud, is 20 years in prison and a fine of $250,000. The maximum statutory penalty for a violation of 18 U.S.C. § 1957, money laundering, is 10 years in prison and a fine of $250,000 or twice the value of the property involved. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

Stephen Corrigan is the Assistant U.S. Attorney who is prosecuting the case with the assistance of supervisory legal technician Kathleen Turner. The prosecution is the result of an investigation by the Federal Bureau of Investigation and Internal Revenue Service, Criminal Investigation, with the assistance of the Securities and Exchange Commission.

This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.

Please note, an indictment contains only allegations against an individual and, as with all defendants, Mr. Kobayashi must be presumed innocent unless and until proven guilty.

Further Information:

Case #: CR 11-106 CW