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TAG | Merrill Lynch Pierce Fenner & Smith Inc.

Mar/13

19

California Broker Fined and Suspended by FINRA for Unsuitable Recommendations to Clients

Comments off · Posted by Securities Lawyer in FINRA

Soreide Law Group, Securities Arbitration Law Firm (888) 760-6552, recently obtained this information from the FINRA website under “Disciplinary and Other FINRA Actions, March, 2013.”

Paul Grover Gomez (CRD #702551, Registered Representative, El Toro, California)

was fined $75,000 and suspended from association with any FINRA member in any capacity for three months. Without admitting or denying the allegations, Gomez consented to the described sanctions and to the entry of
findings that his options recommendations to customers were unsuitable based on their investment objectives, financial situations and needs, including being retired and on fixed incomes; and their lack of financial knowledge and experience, which made them unable to evaluate the risks of the recommended transactions.FINRA’s findings stated that Gomez did not have reasonable grounds for believing that the recommendations to the customers were suitable in light of their financial situations and needs, and did not have a reasonable basis for believing that the customers had the knowledge and experience in financial matters to be reasonably expected to be capable of evaluating the risks of the options transactions that Gomez recommended and his options trading strategy.

FINRA’s findings stated that Gomez exercised discretion in trading options in a customer’s account and exercised time discretion in executing orders on behalf of other customers without the customers providing Gomez with prior written discretionary authority over their accounts. None of their accounts had been accepted by his member firm as discretionary accounts.

Also, FINRA’s findings included that Gomez utilized an uncovered index option combination writing (or selling) strategy in customer accounts. The strategy involved selling put and call options on the Standard & Poor’s (S&P) 100 stock index.

The suspension is in effect from January 22, 2013, through April 21, 2013. (FINRA Case #2009019302101)

It is listed on FINRA’s BrokerCheck that Paul Grover Gomez was previously registered with FINRA at the following brokerage firms:

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
CRD# 7691
LAGUNA HILLS, CA
03/1990 – 08/2009

DEAN WITTER REYNOLDS INC.
CRD# 7556
PURCHASE, NY
12/1979 – 04/1990
This ends the information from FINRA’s website.

If you have suffered financial losses due to your broker/dealer’s recommendations, call Soreide Law Group for a free consultation with an attorney: 888-760-6552.

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Apr/12

24

Banc of America Investment Services, Inc., Sanctioned by FINRA

Comments off · Posted by Securities Lawyer in FINRA

The following information is from FINRA’s website under “Disciplinary Actions, April, 2012:”
 

Banc of America Investment Services, Inc. dba Merrill Lynch, Pierce, Fenner & Smith Incorporated (CRD #7691, New York, New York) 

submitted a Letter of Acceptance, Waiver and Consent in which the firm was censured and fined $55,000. The firm has already paid restitution to the customers involved with the transactions. Without admitting or denying the findings, the firm consented to the described sanctions and to the entry of findings that it purchased municipal securities for its own account from a customer and/or sold municipal securities for its own account to a customer at an aggregate price (including any markdown or markup) that was not fair and reasonable, taking into consideration all relevant factors, including the best judgment of the broker, dealer or municipal securities dealer as to the fair market value of the securities at the time of the transaction and of any other securities exchanged or traded in connection with the transaction, the expense involved in effecting the transaction, the fact that the broker, dealer or municipal securities dealer is entitled to a profit, and the total dollar amount of the transaction.

( FINRA Case #2009018104101)

The information from FINRA’s website has ended.
 
Securities Lawyer, Lars K. Soreide, of Soreide Law Group, PLLC, has represented clients nationwide.
For a free consultation with an attorney, please call 888-760-6552, or visit our website at: www.securitieslawyer.com. 

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Nov/11

10

SEC Sets New Record in Enforcement Actions on Advisers– up by nearly a third, B-Ds by 60%

Comments off · Posted by Securities Lawyer in FINRA

In an article for InvestmentNews.com, November 9th., 2011, Mark Schoeff Jr. writes that the Securities and Exchange Commission (SEC) engaged in an unprecedented crackdown on investment advisers over the last year, contributing to an overall surge in agency enforcement.

The SEC announced that it filed 146 enforcement actions against investment advisers and investment companies during the 2011 fiscal year, which ended Sept. 30. That number represents a 30% increase over the previous fiscal year and a nearly 200% increase since 2002, when the SEC filed 52 cases. The SEC took 112 enforcement actions against broker-dealers, a 60% boost from fiscal year 2010. Overall, the SEC filed 735 enforcement actions, also a record number. The cases resulted in disgorgements and penalties totaling $2.806 billion writes Schoeff.

The enforcement arm of the SEC can now more effectively pursue nefarious activities involving complex products and practices, such as those that contributed to the financial crisis, the agency asserts.

The InvestmentNews.com article states that the agency credited the increased activity to a reorganization of its Enforcement Division. The overhaul included reforming the tips and complaints process and establishing specialized units that allow the division to operate more like a prosecutor’s office.

“We continue to build an unmatched record of holding wrongdoers accountable and returning money to harmed investors,” SEC Chairman Mary Schapiro said in a statement.

SEC ‘s enforcement results release follows a similar announcement last month by the North American Securities Administrators Association Inc. The group said that state regulators reported a 51% increase in enforcement actions that led to $14.1 billion being returned to investors.

The SEC highlighted three investment adviser and broker dealer cases. One was an action against affiliates of The Charles Schwab Corp. for allegedly misleading investors about mutual funds that were laden with mortgage-backed securities. Another centered on AXA Rosenberg Group LLC and its founder, Barr Rosenberg, who was accused of papering over an error in an asset-management computer model. The third involved Merrill Lynch Pierce Fenner & Smith Inc.’s purportedly misusing customer information for proprietary trading and surreptitiously charging trading fees. The agency said that the Schwab paid more than $118 million to settle, while AXA Rosenberg ponied up $217 million for investor losses as well as a $25 million penalty.

The SEC also took 15 actions against executives involved in the financial crisis during fiscal year 2011. In the last two and a half years, the agency said, it has filed 36 separate actions against 81 defendants resulting in $1.97 billion in disgorgement.

Securities Attorney, Lars Soreide, of Soreide Law Group, PLLC, has represented clients nationwide. If you or a family member have sustained a loss through financial fraud, call a Securities Arbitration Lawyer for a free consultation on how to potentially recover your losses. To speak with an attorney, call 888-760-6552, or visit www.securitieslawyer.com.

Soreide Law Group, PLLC., representing investors nationwide before FINRA the Financial Industry Regulatory Authority.

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