The Securities and Exchange Commission (SEC) recently announced that it has obtained an emergency court order to freeze the assets of a South Florida man who has been charged with fraudulently offering investments in oil drilling projects in an article posted on the SEC’s website.

The SEC’s complaint, unsealed in federal court in West Palm Beach, Fla., alleges that Joseph Hilton made numerous misrepresentations to investors while selling limited partnership units in two oil drilling projects earlier this year through his firm Pacific Northwestern Energy LLC. Hilton falsely told potential investors that Pacific acquired its wells from Exxon Mobil Corp., and he overstated Pacific’s experience in the oil and gas industry and the historical accomplishments of its drillers. Hilton raised approximately $789,000 from investors. The SEC’s action froze the assets of Hilton, Pacific, and the two limited partnerships — Rock Castle Drilling Fund LP and Rock Castle Drilling Fund II LP. Hilton’s securities offerings were not registered with the SEC as required under the federal securities laws.

In the SEC’s complaint, there were allegations against Hilton, Pacific, and another company that was controlled by Hilton called New Horizon Publishing Inc. Through Pacific and New Horizon, Hilton sold $2.5 million worth of investments in oil drilling projects sponsored by United States Energy Corp. while deceiving investors about his identity, the anticipated returns on the investments, the amount of oil being produced by U.S. Energy’s wells, and the existence of natural gas wells.

The SEC’s complaint adds that Hilton changed his name from Joseph Yurkin late last year following a final judgment for fraud in a previous SEC enforcement action against him for securities offerings he made through another company he worked for — Homeland Communications Corp.

It was reported that the SEC is seeking disgorgement of ill-gotten gains plus prejudgment interest, financial penalties, and permanent injunctions against Hilton and his entities.

If you or a family member were sold oil and gas offerings by Joseph Hilton (aka Joseph Yurkin) or any of the above companies, and experienced financial losses, contact an attorney at Soreide Law Group for a free consultation on how to recover your investment losses. To speak with an attorney, call 888-760-6552, or visit http://www.securitieslawyer.com.

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The following information is from FINRA’s website under “Disciplinary and Other FINRA Actions, November, 2012.”

Robert Joseph Eanell (CRD #2802778, Registered Representative, St. Petersburg, Florida)

fined $7,500 and suspended from association with any FINRA member in any capacity for 30 business days. Without admitting or denying the findings, Eanell consented to the described sanctions and to the entry of findings that he misrepresented his educational background to prospective securities customers, including on his business cards.

FINRA’s findings stated that on annual forms, Eanell’s member firm asked him to identify all of the degrees, titles and designations that he used on letterhead, business cards or in communications with clients. Eanell failed to disclose the fact that he held himself out as the holder of a doctoral degree.
The suspension was in effect from October 1, 2012, through November 9, 2012. (FINRA Case #2011028386201)
(This ends the information from FINRA’s website.)

Securities Attorney, Lars Soreide, of Soreide Law Group, has represented clients nationwide before FINRA. If you have sustained investment losses due to your stock broker or financial advisor’s recommendations, call for a free consultation on how to potentially recover your losses. To speak with an attorney call 888-760-6552, or visit our website at: http://www.securitieslawyer.com.

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William Mitchell Gray II (CRD #4655762, Registered Principal, Dunedin, Florida)

was fined $5,000 and suspended from association with any FINRA member in any capacity for 30 business days.

Without admitting or denying FINRA’s findings, Gray consented to the described sanctions and to the entry of findings that he impersonated another employee of a non-FINRA member in a telephone call to effectuate the transfer of funds from one account a subsidiary of the non-member company maintained to another account the subsidiary maintained.

FINRA’s findings stated that Gray did not have authority to effectuate the transfer nor did he have the individual’s authority or consent to impersonate him.

The suspension is in effect from September 17, 2012, through October 26, 2012.
(FINRA Case #2012032650501)

The above information is from FINRA’s website listed under “Disciplinary and Other FINRA Actions, October, 2012.”

Lars K. Soreide, of Soreide Law Group, PLLC, represents clients nationwide. For a free consultation on how to potentially recover your financial losses call: 888-760-6552, or you may visit our website and complete the online form at: http://www.securitieslawyer.com.

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Christopher Andrew Carra (CRD #2214509, Registered Representative, Deerfield Beach,Florida)

was fined $20,000 and suspended from association with any FINRA member in any capacity for one year.

Without admitting or denying FINRA’s findings, Carra consented to the described sanctions and to the entry of findings that he attempted to procure investment banking and consulting business from a publicly traded company and posted comments on an Internet message board about the company under numerous author names.

According to FINRA’s findings, several statements in the postings were unwarranted and misleading; some involved conversations between his different handles in which he embellished the prospects for the company.

FINRA’s findings stated that to make the postings, Carra used multiple outside or non-firm-provided email addresses, in violation of his member firm’s WSPs. Carra also used two outside email addresses to communicate with company representatives about business-related matters, in violation of his firm’s WSPs.

FINRA found that one of the outside email addresses may have given the impression that it was a firmprovided email address when it was not one.

The suspension is in effect from July 16, 2012, through July 15, 2013.
(FINRA Case #2011030840501)

This information was listed on FINRA’s website under “Disciplinary and Other FINRA Actions, August, 2012.”

Soreide Law Group, PLLC, represents clients nationwide. Call for a free consultation on how to potentially recover your losses. To speak with an attorney call 888-760-6552, or visit our website at: http://www.securitieslawyer.com.

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In a January 19th., 2012, article for InvestmentNews.com, Jeff Benjamin writes that when pressed, it seems financial intermediaries will tend to overstate their qualifications and services, according to Cerulli Associates Inc.

“Most advisers don’t want to say that they don’t offer some kind of service, so they are more likely to overstate their capabilities,” said Scott Smith, a Cerulli analyst.

Benjamin states that in studying the responses of more than 1,500 financial intermediaries, gathered over the past year as part Cerulli’s annual quantitative-update report on the industry, Mr. Smith recognized a pattern of misrepresentation.

“We found that 59% of respondents were calling themselves full-scale financial planners, when it fact many of them were actually investment planners,” he said.

In Cerulli’s report, which divides the overall financial intermediary universe into four broad categories, there are subtle yet distinct differences between an investment planner and a more comprehensive financial planner.

The InvestmentNews.com article goes on to say that even though 59% of respondents identified themselves as financial planners, Cerulli calculated that only 30% actually fit the definition of being better qualified and certified, working with clients to build comprehensive plans that include insurance and estate planning.

This article defines investment planners, as focusing on asset management, retirement and college savings plans but tend to offer more-modular-style plans.

According to Mr. Smith, the Cerulli analyst, only 22% of the 1,500 respondents identified themselves as investment planners. But when he went over the details of each respondent’s business, Mr. Smith realized that 56% of respondents are actually investment planners. Mr. Smith said much of the discrepancy could be attributed to that fact a lot of advisers view themselves as being more comprehensive than they actually are, simply because they believe they have the potential to be more comprehensive.

“Firms have encouraged their advisers to expand their advice relationships with clients; however, advisers tend to overstate the degree to which they are involved in the planning process,” he said. “The movement to extend advice services is likely being accelerated by turbulent markets, as advisers who base their value to investors on investment performance have suffered more than those with broad advice relationships.”

Benjamin writes that in the two remaining categories — money manager and wealth manager — Cerulli found that advisers have a more realistic perspective on the services they are providing.

Money managers, defined as mostly managing and building portfolios, were identified by Cerulli as representing 9% of the total universe, which was in line what survey respondents indicated.

Cerulli identified 11% of respondents as wealth managers, which compares with 6% of survey respondents identifying themselves as such.

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