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Former Morgan Stanley Advisor Faces FINRA Action Over Undisclosed Loans from Elderly Client

Posted on December 8th, 2025 at 11:41 AM
Former Morgan Stanley Advisor Faces FINRA Action Over Undisclosed Loans from Elderly Client

From the desk of Jim Eccleston at ÍøÆØ³Ô¹Ï

FINRA filed a complaint against former Morgan Stanley advisor Kirk J. Crossen, alleging that he borrowed $400,000 from an 84-year-old customer experiencing early-stage dementia and concealed the loans from his firm. According to AdvisorHub, FINRA alleges that he never sought or received the approvals required under Morgan Stanley’s policies.

FINRA stated that Crossen received two checks totaling $200,000 in February 2022 and later took an additional $200,000 through separate checks in May 2022 and January 2023. During this period, he certified on firm compliance questionnaires that he had not borrowed from any non-family clients without approval. As reported by AdvisorHub, Crossen repaid the loans with $5,000 in interest in May 2023 after a family member of the client contacted him about the transactions. One month later, the client was deemed unable to manage his financial affairs because of a dementia diagnosis.

The complaint alleges violations of FINRA Rule 3240, which prohibits impermissible borrowing from customers, and FINRA Rule 2010, which bars false attestations. AdvisorHub reports that FINRA did not assert claims of elder abuse. Crossen, who later joined Raymond James, resigned from Morgan Stanley in April 2023. According to AdvisorHub, Raymond James terminated him in November 2023 after determining that he lacked candor when questioned about the loans.

Crossen’s regulatory record reflects additional issues. FINRA suspended him in May for failing to comply with an arbitration award requiring repayment of nearly $2.6 million to Raymond James related to recruiting loans. AdvisorHub’s review of his BrokerCheck history also shows two pending customer claims, including an April complaint from his former spouse seeking over $872,000 and an October 2023 customer complaint seeking $6 million for alleged unsuitable investments.

 

ÍøÆØ³Ô¹Ï LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.

Tags: eccleston, eccleston law, finra, morgan stanley

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