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Police: Stolen money paid for lavish lifestyle

A stockbroker is accused of duping a Sun City Center 82-year-old out of $800,000.

Published June 18, 2003

ST. PETERSBURG - Joseph Edward Herndon lived the good life.

He lived in a $360,000 home in St. Pete Beach. He piloted a $130,000 Beechcraft airplane. He owned at least $21,000 worth of jewelry. He bought two diesel engines worth $32,000 for his 31-foot boat.

But Herndon, who was a stockbroker, used money he stole from an 82-year-old Sun City Center man to help finance his lifestyle, police said.

Herndon, 51, was arrested Friday by St. Pete Beach police and the Hillsborough County Sheriff's Office. He was being held in lieu of $3-million bail Tuesday at the Pinellas County Jail on charges of grand theft, organized scheme to defraud and exploitation of the elderly.

"Here's an individual who was (82) years old and who put his confidence in this man to do the right thing and invest his money properly," said Debbie Carter, a spokeswoman for the Hillsborough County Sheriff's Office. "Mr. Herndon did not do what he said he was going to do for the victim."

The Times is withholding the alleged victim's name.

According to investigators, between 1997 and the beginning of 2003, Herndon stole more than $800,000 from the victim. Police said the victim wrote numerous checks to Herndon totaling $476,800.

Herndon also took out an equity loan for at least $120,000 on the victim's house, police said. Herndon was a stockbroker for UBS PaineWebber in St. Petersburg from November 1996 until January, according to the National Association of Securities Dealers. From November 1990 to November 1996 he worked for Merrill Lynch in Sun City Center in Hillsborough County, where his alleged victim lives.

Jeffrey Coleman, a Clearwater attorney representing the alleged victim, said he reported his suspicions about Herndon to authorities, who began investigating. Coleman his client has since reached a confidential settlement with UBS PaineWebber.

"All disputes between my client and Paine Webber have been satisfactorily resolved," Coleman said. "We are under a confidentiality agreement."

Paul Marrone, a spokesman in UBS PaineWebber's New York offices, declined comment Tuesday. In February, a lawyer for one of Herndon's clients filed a complaint against him, according to the state Department of Financial Services. The complaint, which accuses Herndon of "churning" the client's account, or making excessive trades to generate commissions, is pending, said Andy Surratt, a financial examiner in the department.

- Staff writer Helen Huntley contributed to this report.

[Last modified June 18, 2003, 01:48:11]

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