U.S. SEC

By Sandra Emerson, Redlands Daily Facts
Posted: 08/04/14, 11:44 PM PDT |

REDLANDS >> A Redlands broker has been charged by the U.S. Securities and Exchange Commission with stealing $4.4 million from two trust brokerage accounts at his firm and diverting it to friends to spend on luxuries.

John T. Thornes, 47, of Redlands. and former owner of Redlands-based Thornes & Associates, Inc., is accused of diverting funds out of an account for a trust established for the health and welfare of an 80-year-old dementia patient and an account for a trust set up to fund college scholarship for local high school graduates, according to the SEC.

Kyle Larick, 45, of Redlands, and special projects coordinator at Redlands AYSO; Christopher Burnell, 43, of Highland; and Doreen K. Thornes, 83, of Rialto, were named in the complaint.

Thornes has agreed to settle the charges and consented to the entry of a final judgment ordering him to pay interest of $278,540, and a penalty of $4.36 million, according to an SEC news release.

He has also agreed to be permanently enjoined from future violations of sections of the Securities Act of 1933 as well as the Securities Exchange Act of 1934.

Thornes also has agreed to consent to a collateral industry bar and a penny stock bar, according to the SEC.

Burnell, Larick and Doreen Thornes are named in the complaint with the purpose of obtaining any of the funds given to them, according to the SEC.

According to the complaint filed Monday in the U.S. District Court’s Central District, Thornes is accused of stealing money from the two accounts from November, 2010, to April, 2013, for the benefit of two of his friends, Burnell and Larick.

Thornes attempted to pass off the payouts as loans, but there were no loan documents, no stated interested and no collateral for the funds given, according to the complaint.

None of the money was ever repaid.

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