In this case, a Texas Court of Appeals acknowledged that the Dean Witter employee in question, Miguel Millan, stole about $287,000 over a three-year period from his mother’s Dean Witter account that he had established in his role as a Dean Witter broker. Dean Witter was not blameless, as it failed, for instance, to follow special rules for oversight of familial accounts. The Court of Appeals ruled, however, that because Dean Witter had not specifically authorized Millan to engage in fraud, the brokerage firm was not liable for Millan’s wrongdoing.
Public Citizen filed as amicus curiae in support of a petition for review by the Texas Supreme Court. We argued that the ruling insulated brokerage firms and other financial institutions from most, if not all, intentional fraud perpetrated by their employees and makes it less likely that victims of fraud will be compensated for their losses. The Texas Supreme Court, however, declined to hear the case.