Tamara Rae Steele of Pendleton Indiana a stockbroker formerly employed by Comprehensive Asset Management and Servicing (now known as APW Capital Inc.) and Chief Operating Officer of Steele Financial has been charged by Securities and Exchange Commission (SEC) in a Complaint alleging that Steele and Steele Financial made fraudulent investment recommendations to investors. Civil Action No. 1:18-cv-2838 (Sept. 14, 2018).
According to the Complaint, between December of 2014 and October of 2016, investment advisory customers of Steele and Steele Financial had been deceptively advised to purchase more than $13,000,000.00 in speculative investments in Behavioral Recognition Systems Inc. Allegedly, omissions had been made to customers by Steele and Steele Financial regarding Behavioral Recognition Systems paying Steele or her advisory up to eighteen percent in commissions for making the investment recommendations. SEC claimed that Steele and Steele Financial produced profits at their customers’ expense through engaging in the fraudulent recommendations; and violated their fiduciary obligations to the customers.
Moreover, SEC alleged that Steele and Steele Financial accumulated commissions totaling hundreds of thousands of dollars by soliciting investors’ contributions in Behavioral Recognition Systems despite Steele and Steele Financial failing to be registered as brokers.
The Complaint alleged that Steele’s fraudulent scheme led to $15,000,000.00 in securities being purchased by one hundred sixty-five individuals. Apparently, one hundred twenty-seven of the individuals were customers of Steele and Steele Financial. SEC claimed that individuals who invested in Behavioral Recognition Systems through Steele and Steele Financial were not accredited investors.
Further, SEC indicated that Steele took steps to conceal her fraudulent activities regarding Behavioral Recognition Systems from her securities broker dealer employer, Comprehensive Asset Management and Servicing Inc. Allegedly, Steele claimed within compliance attestations that she was not selling away from the firm. SEC contended that Steele lied in this respect because she engaged in private securities transactions.
SEC alleged Steele’s conduct was violative of Securities Exchange Act of 1934 Section 10(b); SEC Rule 10b-5; Securities Act of 1933 Section 17(a); and Investment Advisers Act of 1940 Sections 206(1), 206(2) and 206(3).
Financial Industry Regulatory Authority (FINRA) Public Disclosure reveals that Steele is referenced in twelve customer initiated investment related disputes pertaining to allegations of Steele’s misconduct while employed with Comprehensive Asset Management and Services Inc. Specifically, a customer initiated investment related arbitration claim involving Steele’s activities was resolved for $44,500.00 in damages based upon accusations that Steele made misrepresentations to the customer concerning the terms and conditions of unlisted stock and promissory notes products; and gave the customer bad advice. FINRA Arbitration No. 18-00051 (Jan. 5, 2018).
Another customer filed an investment related arbitration claim concerning Steele’s activities in which the customer requested $124,757.53 in damages supported by allegations of the breach of fiduciary duty to the customer; unsuitable unregistered securities and promissory notes transactions; negligent administration of the customer’s account; and violations of state securities laws and industry rules. FINRA Arbitration No. 18-01033 (Mar. 19, 2018).
Thereafter, Steele was named in a customer initiated investment related arbitration claim where the customer was awarded $167,108.00 in damages based upon Steele having been found liable on the customer’s claims including negligence; violation of FINRA Conduct Rules; breach of fiduciary duty; unregistered and nonexempt securities sales; violation of Indiana Securities Act; selling away; outside business activities; and suitability relating to Behavioral Recognition Systems Inc. stock warrants, preferred stock, common stock and promissory notes. FINRA Arbitration No. 17-01767 (Aug. 10, 2018). On October 25, 2018, another customer filed an investment related complaint concerning Steele’s conduct in which the customer sought $97,000.00 in damages founded on accusations of Steele’s bad investment recommendations and misrepresentations concerning promissory notes and stocks purchased by the customers.
Subsequently, a customer initiated investment related arbitration claim regarding Steele’s conduct was settled for $130,498.00 in damages based upon allegations of Steele, inter alia: soliciting the customer’s investments outside the firm’s auspices in violation of FINRA and NYSE Rules; violating fiduciary obligations to the customer; mishandling the customer’s assets; and committing infractions of Indiana Securities Act through the execution of unsuitable promissory notes sales. FINRA Arbitration No. 18-01832 (Dec. 26, 2018).
Moreover, on December 26, 2018, a customer initiated investment related complaint involving Steele’s activities was resolved for $1,181,449.00 in damages supported by accusations against Steele of advising the customers to buy investments that failed to conform to the customer’s objectives for investing; and Steele making misrepresentations concerning the customer’s stock and promissory notes investments.
Steele was terminated from Comprehensive Asset Management and Servicing Inc. on June 13, 2017 founded on allegations that Steele admitted to having engaged in private securities transactions without informing the firm or procuring the firm’s approval.
