News Column

COURTS: Redlands broker accused of siphoning $4.4 million

August 5, 2014

By Debra Gruszecki, The Press-Enterprise, Riverside, Calif.



Aug. 05--A Redlands broker has been charged with stealing $4.4 million from two trust brokerage accounts and diverting the money to a pair of friends for a lifestyle that involved gaming and travel in a private jet, the Securities and Exchange Commission said in a complaint filed Monday.

John T. Thornes, formerly the sole owner of Thornes & Associates Inc., was accused in a complaint filed in U.S. District Court for the Central District of California of siphoning money between November 2010 and April 2013 out of brokerage accounts that were set up to care for an 80-year-old dementia patient and to pay for college scholarships for high school graduates.

Thornes, without admitting or denying the SEC's allegations, agreed to settle the charge by paying disgorgement of $4.36 million, $278,540 in interest and a $4.3 million penalty, the SEC said.

Thornes was accused in the SEC complaint of passing off $4.4 million in payouts as loans to Christopher Burnell, of Highland, and Kyle Larick, of Redlands. However, the SEC said none of the money was repaid and no loan documents could be produced.

The money was used to charter a private jet, buy a luxury car and pay for a vacation home, the SEC complaint said. Burnell is accused of using the funds to gamble at a nearby casino or pay gambling debts.

Thornes, who was also accused of deceiving his mother with respect to the educational trust, had her sign blank checks for the misappropriation scheme. His mother, Doreen Thornes, was paid about $84,000 in excess trustee fees, according to the SEC.

Burnell, Larick and Thornes were named as relief defendants, as a way for the SEC to recover what the federal agency described as "illicit funds" that may be in their possession.

Contact the writer: 951-368-9423 or dgruszecki@pe.com

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(c)2014 The Press-Enterprise (Riverside, Calif.)

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Source: Press-Enterprise (Riverside, CA)


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