FINRA enforcement actions are rare because generally the offending broker or brokerage firms settles allegations of misconduct before a formal enforcement action is brought by entering into a Letter of Acceptance, Waiver and Consent or AWC, where offending broker or brokerage firm consents or admits to a narrow finding of facts, pays fines or penalties,…

­A report released today by the Stanford Law School Securities Class Action Clearinghouse in cooperation with Cornerstone Research finds the number of securities fraud class actions filed in 2005 decreased more than 17 percent compared to 2004 levels, falling from 213 filings to 176. The 2005 filing rate is nearly 10 percent below the 1996 ­-…

Fort Lauderdale, Florida, February 4, 2012 (Globe Newswire) –Royal Alliance Associates, an  AIG Advisor Group division owned by American International Group (NYSE: AIG), sued victims of a Ponzi scheme to block pending FINRA arbitration claims, where the victims have alleged that Royal Alliance Associates failed to supervise the sales agents who sold the fraudulent investments,…

A group of investors filed a class-action lawsuit on January 15, 2008 seeking nearly $500 million dollars in damages from Morgan Stanley, alleging their broker, Michael James Kazacos, gave them fraudulent investment advice and made false promises to Eastman Kodak retirees that never materialized. The plaintiffs are all former employees of Eastman Kodak Co in…

The Securities and Exchange Commission today charged Morgan Stanley and one of the firm’s former investment adviser representatives with securities law violations for misleading clients about the money managers being recommended to them and failing to disclose conflicts of interest. According to the SEC’s orders in the case, Morgan Stanley breached its fiduciary duty to…

Fort Lauderdale, Florida, February 4, 2012 (Globe Newswire) –Royal Alliance Associates, an  AIG Advisor Group division owned by American International Group (NYSE: AIG), sued victims of a Ponzi scheme to block pending FINRA arbitration claims, where the victims have alleged that Royal Alliance Associates failed to supervise the sales agents who sold the fraudulent investments,…

Sixteen specialist panels will examine Cultural Considerations in International Arbitration: Bridging the Divide – Civil vs. Common Law Ad-hoc or Institutional Arbitration – The Good and the Bad Procedure Under the UNCITRAL Model Rules Drafting the Arbitration Clause – Addressing the Issues Anti-suit Injunctions – Protection of Legal and Equitable Rights Arbitration and the Feeling…

The US Securities and Exchange Commission issued cease-and-desist proceedings against Michael A. Horowitz and Moshe Marc Cohen from as the result of a fraudulent scheme to profit from the imminent deaths of terminally ill hospice and nursing home patients through the purchase and sale of more than $80 million in deferred variable annuities. The Scheme Michael…

The Financial Industry Regulatory Authority or FINRA announced today the it had entered into a regulatory settlement agreement, or Letter of Acceptance, Waiver and Consent with Berthel Fisher & Company Financial Services, Inc. As part of the settlement, FINRA found that from approximately 2007 through 2012, Berthel Fisher had an inadequate supervisory system and written…

Gone are the days of the penny stock and the “chop stock.” In the old days, in addition to house stocks, brokers would trade “lunch-time” stocks. A lunch time stock is a stock that trades “a quarter to one,” i.e. the bid is a quarter or 25 cents, but the offer is $1.  So if…

The United States Securities and Exchange Commission, after an investigation, instituted administrative proceedings against Roy Dixon, Jr., a former registered representative of Professional Asset Management, Inc., a licensed broker dealer in Bloomfield Hills, Michigan Roy Dixon, Jr., age 50, resides in Atlanta, Georgia and was the owner and founding general partner of Onyx Capital Advisors,…

Samuel Delshaul Shoemaker was recently barred from associating with any FINRA member for allegedly disclosing personal confidential information of bank customers to a third party who was not authorized to receive it and for failing to provide information and testimony in the course of a FINRA investigation. In a default decision, the FINRA department of…

FINRA barred Scott Donovan Schroeder, formerly a broker at Milkie Ferguson Investments, for making unsuitable investment recommendations to elderly customers. According to FINRA, Scott Schroeder also made material misrepresentations and omitted to disclose material facts to customers. Schroeder also allegedly went against Milkie Ferguson policies by facilitating a loan application for a customer who used…

Arthur Lin was the branch manager of an LPL Financial office in Itasca, Illinois. According to the US Securities and Exchange Commission, Arthur Lin, and two others, Marcin Malarz and Jacek Sienkiewicz, both of whom have apparently fled to Poland, raised at least $14,380,000 from investors through the fraudulent unregistered offer and sale of promissory…

Lynn A. Simon was arrested for swindling investors of over a $1 million. Once authorities were alerted to his swindle, because investors stopped receiving their interest payments, Simon disappeared and was later traced to Alabama and New Mexico. During the course of his association with CFD Investments, Inc., while operating his own office under the…

Steven B. Heinz, of Provo, Utah, a registered stockbroker of Ogilvie Security Advisors Corp. was charged by the United States Securities and Exchange Commission for multiple violations of federal securities laws. According to the SEC, beginning in January 2012, during his association with Ogilvie Security Advisors Corp., Heinz provided investment advice and offered and sold…

Donald Richard Dahn (aka, “Rick” Dahn) was barred from associating with any FINRA member for borrowing money from bank customers to pay the operating expenses of a company Dahn ran with his brother. On October 14th, Donald Dahn submitted a Letter of Acceptance, Waiver and Consent (“AWC”), neither admitting nor denying FINRA’s findings but accepting…

The United States Securities Exchange Commission and the Department of Justice filed charages against Gurudeo “Buddy” Persaud. According to documents filed by the SEC from no later than July 2007 until at least January 2011, Persaud, directly and through his company, While Elephant Trading Company LLC, operated an offering fraud that, by November 7, 2007,…

Glen A. Galemmo, a Cincinnati stockbroker associated with Landmark Investment Group, Inc., plead guilty in United States District Court to criminal charges that between 2005 and July 2013, he operated a Ponzi scheme that took in at least $100 million from investors. According to the federal indictment Galemmo  operated the Queen City Investment Fund, along…

Martin John Maloney (A.K.A. Marty Maloney, and Martin J. Maloney), previously associated with MetLife Securities Inc. at 150 Essjay Rd., in Williamsville, NY 14221, was barred from association with any FINRA member in any capacity in October of 2013 for converting $220,000 of a MetLife customer’s money. Marty Maloney led a customer and his wife…

On October 16, 2013 FINRA barred David C. Key from association with any FINRA member in any capacity. Without admitting or denying the findings, Mr. Key consented to the sanction by submitting a Letter of Acceptance, Waiver and Consent (“AWC”), which FINRA accepted. David Key was a registered Principal with PFS Investments Inc. (PFSI, also…

FINRA has accused James Arnold Busch, a former Wells Fargo & Co. (WFC) broker, of stealing at least $1.3 million from customers in Georgia. Most of these customers were elderly women. Without admitting or denying the findings, prior to a regulatory hearing, and without an adjudication of any issue, Busch submitted a Letter of Acceptance,…

Wellesley Massachusetts stockbroker Paul J. Dumouchel was barred from the securities industry for life because he used an 82 year old Alzheimer’s patient to make $63,000 in commissions. According to the FINRA The Financial Industry Regulatory Authority notes, Dumouchel while associated with the brokerage firm, H. Beck, drove the woman to five local banks and…

Investment fraud rarely involves actual theft. Investors may lose their savings as the result of the tainted recommendation to purchase defective financial products, brokers may “sell away” or engage in the sale of unregistered promissory notes or other Ponzi schemes, but actual theft is generally quite rare. However on December 3, 2013, the Financial Industry…

Charles Vista, LLC, formerly known as D.C. Evans & Co. (“DCE”), was a registered broker-dealer with its principal place of business at 100 Williams Street, 18th Floor, New York, New York 10039. DCE was acquired by Gregg C. Lorenzo, through GJL Holding Company, LLC, following his departure from John Thomas Financial in 2009. Lorenzo is…

Jinesh Brahmbhatt also known as “Hodge,” was permanently barred by the Financial Industry Regulatory Authority or FINRA in connection with an alleged $18 million fraud perpetrated against a number of high profile National Football League and National Basketball Association players. Brahmbhatt, also conducting business under the name Jade Private Wealth Management, agreed to an a…

According to Cerulli Associates Inc., the big wire-houses manage over $4.7 trillion in client assets. However, it is estimated that $50 billion is wasted each year by clients paying undisclosed and unnecessary fees or losses based on inappropriate product choices and high expense levels. When customer go from one brokerage firm to another, the practice…

The Securities and Exchange Commission today sanctioned three investment advisory firms Modern Portfolio Management Inc., Equitas Capital Advisers LLC, and Equitas Partners LLC for repeatedly ignoring problems with their compliance programs. The enforcement actions arise from the agency’s Compliance Program Initiative, which targets firms that have been previously warned by SEC examiners about compliance deficiencies but…

Nicholas J. Guiliano, Esquire of the Guiliano Law Group, P.C. is scheduled to speak at the Rutgers Law School Camden on April 12, 2013 on the history and practice of federal securities arbitration law, including recent developments in the law, as part of a course entitled Securities Litigation and Enforcement. His lecture will focus on…

FINRA Publishes 2012 Year in Review highlighting enforcement actions, including non-traded REITS, Reverse and Leveraged ETF Funds, and Structured Products. FINRA claims that it initiated 1,846 routine examinations, more than 800 branch office examinations, and 5,100 cause examinations in response to events such as customer complaints, terminations for cause and regulatory tips. How many of these…

A putative class action was filed Monday against Behringer Harvard REIT I, a $4.4 billion real estate investment trust in U.S. District Court for the Northern District of Texas by any investor who purchased 1,275 shares of the trust from 2004 to 2008. Behringer Harvard is one of more than a half dozen large non-traded…

On September 10, 2012, Judge Koeltl of the United States District Court for the Southern District of New York dismissed a class action complaint against ProShares based upon the sale of its inverse and leveraged ETF funds. ProShares created and operated three types of ETFs: “Inverse ETFs,” the goal of which was for the net asset…

This week the SEC Charged J.P. Turner & Co. with the failure to supervise and three brokers for Churning. The Securities and Exchange Commission charged three brokers Ralph Calabro, Jason Konner, and Dimitrios Koutsoubos with the churning of customer accounts while they were associated as registered representatives of JP Turner. JP Turner has approximately 513…

In 2011 Bank of America Merrill Lynch, in conjunction with ETF Securities, launched the first Exchange Traded Fund (ETF) linked to European equity volatility, listed on the London Stock Exchange. The ETFX-BofAML IVSTOXX ETF is linked to the EURO STOXX 50 Investable Volatility Index (the Investable VSTOXX, or IVSTOXX), an investable index which reflects the…

Broker William Thomas Johnson Jr. has been permanently barred by the Financial industry Regulatory Authority (FINRA) for misappropriating about $100,000 in customer funds. On June 1, Johnson submitted a Letter of Acceptance, Waiver and Consent (AWC) to settle a number alleged FINRA rule violations. He accepted and consented to an entry of findings by FINRA…

On July 13, a three-person arbitration panel of the Financial Industry Regulatory Authority (FINRA) handed down a $1.7 million arbitration award against JHS Capital Advisors Inc. and one of its former brokers. Claimant John Sisk claimed excessive trading and churning, common law fraud, ordinary negligence, gross negligence, breach of contract, negligent retention and hiring, control…

The Financial Industry Regulatory Authority (FINRA) implemented a new suitability rule on July 9 that broadens the list of factors firms and brokers need to analyze before recommending securities or investment strategies. The SEC Approves New FINRA Rule The Securities and Exchange Commission (SEC) approved the new FINRA Rule 2111 in November 2010. Since then,…

The Financial Industry Regulatory Authority (FINRA) has filed a complaint against Charles Duane Lewis, a broker with H.D. Vest Investment Services who misappropriated more than $500,000 from an elderly customer. The complaint, filed by FINRA’s Department of Enforcement on June 25, states that Lewis misappropriated the money between December 2007 and May 2010 from an…

Merrill Lynch, Pierce, Fenner & Smith Inc. has been fined $450,000 by the Financial Industry Regulatory Authority (FINRA) for failure to supervise operations to prevent unsuitably high concentrations of structured products from building up in customer accounts. The firm submitted a Letter of Acceptance, Waiver and Consent (AWC) to settle alleged violations of FINRA rules….

OppenheimerFunds Inc. agreed to pay roughly $35 million to settles charges by the Securities and Exchange Commission (SEC) that it made misleading statements to investors in two mutual funds that rapidly lost value during the 2008 financial crisis. The settlement consists of a $24 million penalty, disgorgement of about $9.8 million and prejudgment interest of…

Occupy Wall Street filed an amicus curiae brief on May 21 urging the 2nd U.S. Court of Appeals to affirm the district court’s rejection of a $285 million settlement agreement Citigroup reached last year with the Securities and Exchange Commission (SEC) to resolve charges that the giant bank had gamed the mortgage bond market. The…

Two subsidiaries of Morgan Stanley were fined by the Financial Industry Regulatory Authority (FINRA) earlier this month for negligently making material misrepresentations to investors regarding the call price and yield of certain fixed-income securities, as well as negligently failing to disclose that these securities were interest-only. The misrepresentations were the result of incomplete information that…

Scott B. Hostutler, formerly a broker with Edward Jones, was suspended for 10 days by the Financial Industry Regulatory Authority (FINRA) for trading in a customer’s account without authorization. Hostutler was fined $5,000 in addition to his suspension from association with any FINRA member in any capacity. The sanctions were set out in a Letter…

UBS Financial Services Inc. has agreed to pay a $1.5 million fine after the Financial Industry Regulatory Authority (FINRA) charged the firm with failure to supervise the sale of complex financial products known as non-traditional exchange-traded funds, as well as for making unsuitable recommendations of these funds. In addition to the fine, UBS Financial Services…

Citigroup Global Markets Inc. has been fined $2 million by the Financial Industry Regulatory Authority (FINRA) for failure to supervise and for making unsuitable recommendations in connection with the sale of complex financial products known as non-traditional exchange-traded funds. The firm submitted a Letter of Acceptance, Waiver and Consent (AWC) to settle a FINRA disciplinary…

After he misappropriated $734,000 from various customers, Joel W. Carlson, a former broker with Sagepoint Financial Inc., was permanently barred from the business by the Financial Industry Regulatory Authority (FINRA). Carlson is also facing a civil lawsuit alleging $50,000 in damages stemming from fraudulent indexed annuity sales and misappropriation. The litigation is pending 2nd Judicial…

Thomas R. Fortino, a former broker with First Allied Securities Inc., was fined and suspended by the Financial Industry Regulatory Authority (FINRA) after he engaged in business outside his firm, often called selling away, and misled his firm about these activities. Fortino submitted a Letter of Acceptance, Waiver and Consent (AWC) that resolved the FINRA…

AXA Advisors LLC has been fined $50,000 by the Financial Industry Regulatory Authority (FINRA) and censured for its failure to supervise a broker who misappropriated $122,000 from the money market account of a customer, 70 percent of the account’s value. Letter of Acceptance Waiver and Consent The firm submitted a Letter of Acceptance Waiver and…

Timothy David Cochrane has been permanently barred from the financial industry as part of a settlement of an action against him for misappropriating $600,000 in customer funds. On March 30, the Financial Industry Regulatory Authority (FINRA) accepted a Letter of Acceptance, Waiver and Consent (AWC) submitted by Cochrane to resolve alleged rule violations. Cochrane neither admitted…

Raymond James Financial Services Inc. has agreed to pay a $400,000 fine to settle allegations that it failed to supervise a customer who used accounts he had with the firm to operate a multi-million-dollar Ponzi scheme.The firm submitted a Letter of Acceptance Waiver and Consent (AWC) to resolve a disciplinary action brought by the Financial…

Last month, brokerage firm Stifel, Nicolaus & Co. Inc. settled a disciplinary action brought against it by the Financial Industry Regulatory Authority (FINRA) after one of the firm’s brokers ran a Ponzi scheme that defrauded customers. The terms of the settlement included a $350,000 fine and a censure. Stifel Nicolaus also agreed to pay restitution…

Roland Craig Matatics, a former broker with MetLife Securities Inc. in Keene, N.H., has been permanently barred from the financial industry for misappropriating $10,000 from a customer suffering from dementia. Roland Craig Matatics Submits an AWC The money was later returned and Matatics submitted a Letter of Acceptance, Waiver and Consent (AWC) to settle an action…

Last month Leland O. Stevens, a former broker with Great American Advisors Inc., settled a disciplinary action against him after he served up his unwitting customers to a Ponzi scheme. The Financial Industry Regulatory Authority (FINRA) filed a complaint against Stevens last year for his role in the sale of promissory notes that turned out…

Cornerstone Core Properties REIT Inc., a non-traded real estate investment trust, has sent a letter to its shareholders bearing some bad news: The REIT’s valuation has plunged from the original issue price of $8.00 per share down to $2.25, a dive of about of 72 percent. Cornerstone’s Letter to Shareholders The company reported the revised…

Jimmy Wayne Freeman, a broker with Texas-based PlanMember Securities Corp., was ordered by the Texas Securities Board to pay more than $500,000 in restitution to investors after he sold them securities issued by an outside firm without his firm’s permission and without holding the appropriate securities license. Freeman was also suspended for 12 months from…

Robert Bales, the US Army staff sergeant accused of massacring 16 Afghan civilians, was a former stockbroker, who enlisted in the U.S. Army to apparently avoid paying an elderly Ohio couple of their life savings in a stock fraud. According to FINRA records, from 1996 through 2000, Bales was associated with at least seven brokerage…

The Financial Industry Regulatory Authority (FINRA) has sanctioned Christine L. Cantone and her firm for their failure to supervise a broker who sold fictitious investments to customers through which he misappropriated over $1.6 million. Cantone & Cantone Research Inc. Censored & Fined Pursuant to an FINRA order dated Feb. 22 that accepted an offer of…

Anthony L. Semadeni, a former stockbroker with World Group Securities, has been barred from the financial industry for two years and ordered to pay up to $60,000 in restitution plus interest to customers for borrowing money from them and never fully paying it back. Semadeni also lied to World Group about the loans he received…

A former Edward Jones administrator has been permanently barred from the financial industry after misappropriating a total of $63,000 from 21 customers. According to a default decision issued by the Financial Industry Regulatory Authority (FINRA) on Feb. 15, Carolyn Avia Harmon misappropriated $63,000 in customer funds between November 2006 and September 2009. She also failed…

A federal judge in Los Angeles has ordered Stanley C. Brooks, the former CEO of Brookstreet Securities Corp., to pay the maximum civil penalty of $10 million in a securities fraud case that goes back to the financial crisis, the Securities and Exchange Commission (SEC) announced on March 2. According to the docket, Judge David…

Over five years, former broker James Scott McKee defrauded the customers of the brokerage firms where he worked out of nearly $1 million, using lies and omissions to induce them to invest in various real estate ventures in which he had a direct or indirect financial interest, according to a complaint filed by the Financial…

Evidently, it slipped the mind of one New York stockbroker that dead men can’t trade. Eric Anthony Foster, a stockbroker with Halcyon Cabot Partners Ltd., has been fined $10,000 by the Financial Industry Regulatory Authority (FINRA) and suspended for three months for unauthorized trading in the account of a deceased customer while he worked for…

Broker-dealer Stone & Youngberg have been fined $350,000 and censured by the Financial Industry Regulatory Authority (FINRA) for charging excessive markups on trades of collateralized mortgage obligation securities (CMOs) for retail customers. The firm was also required to pay about $206,000 in restitution to customers, without interest, per the terms of a Letter of Acceptance,…

Clyde M. Thornburg, a former stockbroker with NEXT Financial Group Inc., was charged earlier this month with unsuitable short-term trading and switching in the accounts of elderly and unsophisticated investors. The FINRA Complaint On Feb. 9, the Financial Industry Regulatory Authority (FINRA) filed a complaint against Thornburg, a Florida-based registered representative with NEXT. The affected…

Philip Eckstein, a former MetLife Securities Inc. broker, was permanently barred from association with any members of the Financial lndustry Regulatory Authority (FINRA) after he converted $10,000 of an elderly customer’s money to his own use. FINRA announced the sanction in a February 8, 2012 Order accepting Eckstein’s offer of settlement after a disciplinary proceeding…

In a striking example of the ineffectiveness that can plague securities regulation, investment adviser Robert Pinkas allegedly misappropriated $800,000 from a client to pay for disgorgement and costs resulting from a previous case brought against him by the Securities and Exchange Commission (SEC). On Feb. 15, the SEC issued an order to start administrative and…

A former stockbroker for Wells Fargo Advisors LLC has been fined $5,000 and suspended from the financial industry for six months for changing dates and account numbers on forms without customers’ permission. In June 2010, Judith Martin altered the dates and account numbers on 25 Initial Public Offering (IPO) Certification Forms that the Wells Fargo…

Family members may want to stay informed about this aspect of their relatives’ lives, to make sure unscrupulous financial professionals do not take advantage of senior citizens who are cognitively impaired. About 5.2 million Americans over the age of 65 suffer from Alzheimer’s, according to a 2011 report from the Alzheimer’s Association. About 200,000 people…

Florida-based brokerage firm 1st Discount Brokerage Inc. has been censured and fined $40,000 by the Securities and Exchange Commission (SEC) for its failure to supervise a broker who defrauded investors of nearly $9 million. In addition, Michael R. Fisher, executive-vice president of the firm at the time, was ordered to pay $10,000, according to the…

Citigroup Global Markets Inc. was censured and fined $725,000 this month by the Financial Industry Regulatory Authority (FINRA) for its failure to comply with disclosure requirements. From January 2007 through about March 2010, Citigroup Global failed to comply with the disclosure requirements of Rule 2711 of the National Association of Securities Dealers (NASD), a predecessor to…

Penny stock promoter First Resource Group LLC and its principal David H. Stern were charged with three counts of fraud by the Securities and Exchange Commission (SEC) in a complaint filed on Jan. 26. The SEC Complaint Stern and his Florida company fraudulently manipulated the market for the stock of two small, thinly traded companies,…

Former stockbroker Ralph Edward Thomas Jr., who pleaded guilty to mail fraud in September, has been barred for life by the Financial Industry Regulatory Authority (FINRA) for conversion of more than $800,000 in customer funds to his own use. According to FINRA, Thomas misappropriated the money from three vulnerable customers between December 2001, and July…

Former LPL Financial Corp. stockbroker Amrita Holden has been permanently barred by the Financial Industry Regulatory Authority (FINRA) for wrongfully converting about $187,000 in customer funds to her own use. While employed by LPL, Holden forged the signature of an elderly customer on distribution request forms for the customer’s Individual Retirement Account (IRA). These forms…

A purported class-action lawsuit brought by a broker-dealer against the predecessor to the Financial Industry Regulatory Authority Inc., or FINRA, went out meekly this week, when the U.S. Supreme Court denied without explanation the plaintiff’s petition for the case to be heard. The suit, Standard Investment Chartered Inc v. National Association of Securities Dealers, was…

Morgan Stanley & Co. LLC has been censured and fined $600,000 by the Financial Industry Regulatory Authority, or FINRA, for failure to supervise its stockbrokers to ensure compliance with its own guidelines regarding structured products. As a result of this failure of supervision, the firm’s stockbrokers recommended a total of 14 unsuitable structured product investments…

The receiver appointed to handle the fallout from one of the largest Ponzi schemes in Minnesota history has filed suit in federal court in Minneapolis against NRP Financial Inc. for its failure to supervise a registered broker who participated in the fraud that bilked investors out of $150 million. NRP was a registered broker-dealer with…

On October 4, 2011, a FINRA Arbitration Panel sitting Portland, Oregon, in the matter of James D. Brogden, et. al. v. Merrill Lynch Pierce Fenner & Smith, Inc., FINRA Arbitration Number 10-01725 rendered an arbitration award against Merrill Lynch for $96,049 of the $309,358 in damages sought in connection with the recommendation to purchase Federal…

The Financial Industry Regulatory Authority, or FINRA does not take kindly to stockbrokers who fail to disclose tax liens, perhaps because such behavior can signal un-trustworthiness, the last thing you want to see in a stockbroker. If you are a stockbroker who fails to timely disclose such liens per FINRA rules, you are likely to…

The migration of stockbrokers into the advisory arena through the marketing of brokers as “trusted advisers” and “financial advisors” over the years has fueled confusion among investors as to the services provided by stockbrokers and investment advisers as well as the level of protection. The dirty secret is that aside from filling out an Investment…

Welcome to the age of the Ponzi Scheme, the result of the non-regulation of “hedge funds.” Madoff, Nagel, Stanford, Spitzer, the list goes on and on, millions, tens of billions of dollars swindled by Ponzi scheme scam operators, always, or at least most often leaving investors with nothing, except whatever meager sum the government may…

The Financial Industry Regulatory Authority, recently filed a proposed rule change with the U.S. Securities & Exchange Commission to to adopt NASD Rule 2830 (Investment Company Securities or mutual fund shares) as FINRA Rule 2341 (Investment Company Securities) with certain important changes. NASD Rule 2830 NASD Rule 2830 regulates brokerage firms’ activities in connection with…

The Guiliano Law Group. P.C. has announced the filing of securities arbitration claims before the Financial Industry Regulatory Authority (FINRA) on behalf of investors suffering losses in Inverse and Leveraged Exchange Traded Funds or ETFs. Many investors were sold these securities based upon the notion that they could be a long term hedge. Most ETFs track…

The United States Securities and Exchange Commission announced that Wells Fargo Securities LLC consented to an $11.2 million fine in connection with the sale of collateralized debt obligations (CDOs) in late 2006 and early 2007. The SEC found that Wachovia Capital Markets violated the securities laws by fraudulently charging undisclosed and excessive markups in the…

Just when you thought that you heard it all. The New York Stock Exchange disciplined former Morgan Stanley stockbroker Charles Winitch of Scarsdale, New York, for unauthorized trading, churning or excessive activity, and breach of fiduciary duty with respect to the accounts of his customers. Mr. Winitch’s fraudulent conduct, however, relates to the accounts of…

Following the 2003 Global Settlement with FINRA and the Securities & Exchange Commission, were Morgan Stanley paid $125 million in fines, disgorgement, and “procurement of Independent Research,” it seems Morgan Stanley has been caught again publishing inaccurate and misleading investment research report, which fail to disclose Morgan Stanley?s financial interests, and conflicts of interest to…

The man who predicted in March 2007 the collapse of the mortgage-backed securities market now predicts that Wall Street banks are creating the next investment bubble by selling opaque and unregulated structured notes to investors hunting for yield. Richard Christopher Whalen Whalen wrote today in a report, using the same “loophole” that allowed over-the-counter sales…

Securities arbitration results from the Financial Industry Regulatory Authority (“FINRA”) Office of Dispute Resolution reporting the outcomes of customer initiated investment related arbitrations against stockbrokers and investment firms has been released for 2009. Not surprisingly, the number of FINRA customer initiated arbitration cases filed in 2009 increased 43% from 4,982 cases in 2008 to 7,137…

John Edward Mullins and wife allegedly drained their client’s trust while she was in a nursing home. A former Morgan Stanley broker was barred today by the Financial Industry Regulatory Authority Inc. for allegedly misappropriating $11,156.47 from the charitable foundation of a 97-year-old nursing home resident who was his client for more than 20 years….

FINRA Fines Bank Broker-Dealers $1.65 Million for Supervisory Failures in Variable Annuity, Mutual Fund and UIT Transactions. Five Firms Sanctioned, One Charged with Unsuitable VA Sales to the Elderly Washington, D.C. — The Financial Industry Regulatory Authority (FINRA) announced today that it fined five bank broker-dealers a total of $1.65 million for deficient supervision and…

Financial crises have a way of jolting investors into seeing that perhaps their brokers weren’t such trustworthy advisers after all. Requests for arbitration hearings are up 85 percent so far this year at the Financial Industry Regulatory Authority, the only place investors can go when they think they have been fleeced. Going to court isn’t…

According to the latest figures from the Financial Industry Regulatory Authority (FINRA), through October 2008, investment arbitration claims are up 49% from 2007. In addition, during the first 10 months of 2008, more cases have been already been filed than were filed in all of last year. Most brokerage agreements contain provisions that any disputes…

If your stockbroker sold you improper, excessively risky investments, or — failed to disclose the riskiness of what appeared as an otherwise conservative investment, and as a result you lost your shirt — then today’s story will be especially relevant. For my readers who are stockbrokers, I’ll tell you right now that I’m going to…

Last week I told you about what happened to Hal and his wife, both 67, retired, and long time readers. From more than a million dollars in their 401K account as of January, 2006, their investments have lost close to $750,000. Why? What Went Wrong? “In our final preparations for retirement, in early 2006 even…

Philadelphia, PA (MarketWire) November 6, 2008 –The Guiliano Law Group, P.C., a leading securities lawyer firm in Philadelphia, Pennsylvania announced today it is actively investigating and pursuing securities fraud claims against certain securities broker-dealers resulting from the risky or unsuitable recommendation of securities. Investment trusts, labor unions, pension funds, local municipalities, school boards and charitable…

Washington, D.C. – The Financial Industry Regulatory Authority (FINRA) announced today that it has imposed a $250,000 fine against J.P. Turner & Company, LLC of Atlanta, GA, for failing to have an adequate supervisory system designed to ensure that its registered representatives charged customers fair and reasonable commissions on stock trades. As part of the…

LPL Financial was sued last week in Phoenix for its role in an affinity fraud case involving members of a local church and an ex-broker who allegedly stole $5 million from at least 40 victims. The lawsuit alleges that the broker, James Buchanan, was able to steal $382,376 from an elderly married couple because LPL…

PHILADELPHIA – PA Nicholas J. Guiliano of the Guiliano Law Group, P.C., in Philadelphia, Pennsylvania announced today he is actively investigating and pursuing fraud claims against certain securities broker-dealers resulting from the risky or unsuitable recommendation of the securities of certain financial institutions. Tens of Billions Lost in Securities Investment Trusts, Labor Unions, Pension Funds,…

The Securities and Exchange Commission today charged a former broker in South Florida, Gary J. Gross, who allegedly defrauded senior citizens and other customers through a variety of abusive sales practices, garnering him more than $700,000 in commissions and fees while causing more than $2.7 million in investor losses. SEC Chairman Christopher Cox announced the…

Despite intense pressure from regulators to tighten recruiting standards for brokers with marks on their records, these bad apples are still being hired by new firms, recent cases illustrate. The problem is compounded by an industry practice that condones silence from broker-dealers when a registered representative leaves under a cloud, attorneys and regulators said. It’s…

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