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Financial services

Kenneth Thom Arrested for Securities Fraud and Investment Adviser Fraud

Strategic Insights

— 2 min read

Kenneth Thom, a former broker who was previously suspended by the Financial Industry Regulatory Authority (FINRA) in 2011, used social media to convince his followers that he was a successful trader. However, Thom allegedly misplaced nearly $800,000 from around 67 clients, investing only $350,000 and using the rest for personal expenses, including luxury goods. Thom published false performance updates to hide his losses and even changed the name of his Facebook group to "AYBABTU" after his clients stopped responding to him.

Key Takeaways:

  • Kenneth Thom, a 41-year-old from Westfield, New Jersey, was arrested for securities fraud and investment adviser fraud, which carry maximum sentences of 20 and five years in prison, respectively.
  • Thom was previously suspended by FINRA in 2011 for failing to pay an arbitration award to an investor, and he admitted to commingling the investor's money with his own money in a brokerage account.
  • Despite being suspended, Thom turned to social media and promoted himself as a successful trader, selling trading courses and trade suggestions to his followers.
  • Thom raised nearly $800,000 from around 67 clients, investing only $350,000, which resulted in a net loss of approximately 73% between March 2024 and March 2025.
  • Thom published false performance updates to hide his losses, including a post claiming that his three purported shared accounts were positive year-to-date, with returns ranging from 4% to 120%.
  • Thom used the money for personal expenses, including travel, dining, and luxury goods, and even changed the name of his Facebook group to "AYBABTU" after his clients stopped responding to him.
  • The FBI will never waive in apprehending individuals who steal from others' pockets to finance personal purchases, according to FBI Assistant Director in Charge Christopher G. Raia.
  • Thom's actions betrayed the trust of investors and result in a significant financial loss.

Statistics:

  • Thom raised nearly $800,000 from around 67 clients.
  • Thom invested only $350,000, resulting in a net loss of approximately 73% between March 2024 and March 2025.
  • Thom published false performance updates, claiming that his three purported shared accounts were positive year-to-date, with returns ranging from 4% to 120%.
  • Thom used the money for personal expenses, including travel, dining, and luxury goods.
  • The charges contain in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

Sources:

  • U.S. Attorney for the Southern District of New York, Jay Clayton, and Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation ("FBI"), Christopher G. Raia
  • The Financial Industry Regulatory Authority ("FINRA")
  • The FBI
  • The U.S. Securities and Exchange Commission
  • Indictment and description of the Indictment set forth in the release
  • MIL Security OSI (http://milnz.co.nz/mil-osi-aggregation/) - Copyright 2025 Multimedia Investments Ltd, distributed by Contify.com

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