Stockbroker’s Bad Investment Strategy Not Fraudulent Conduct

A stockbroker whose conduct was unprofessional and unresponsive to an investor but not false or fraudulent, can still wipe out the debt from her claims in his Chapter 7 bankruptcy case, the U.S. Bankruptcy Court for the Eastern District of Wisconsin held.

Susan Dorsch’s complaint failed to state a claim for false pretenses, false representation, or fraud under the Bankruptcy Code, and she couldn’t prove that Jeffrey Butler committed fraud or defalcation in a fiduciary capacity, Chief Judge Susan V. Kelley wrote Nov. 6 (Dorsch v. Butler (In re Butler), 2017 BL 398139, Bankr. E.D. Wis., Chapter 7 Case No. 17-22141-svk Adv. No. 17-02169, 11/6/17