Securities Lawyer Blog | Victim of Fraud?

TAG | misappropriation of funds by broker

May/13

20

Tampa Rep Barred by FINRA for Misappropriation of Funds

Comments off · Posted by Securities Lawyer in FINRA

The Soreide Law Group, PLLC, is a Securities Arbitration Law Firm, (888) 760-6552, and obtained the following information on FINRA’s website under “Disciplinary and Other FINRA Actions, May, 2013.”

Raphael Huaman (CRD #5868404, Registered Representative, Miami, Florida)

was barred from association with any FINRA member in any capacity. Without admitting or denying the findings, Huaman
consented to the described sanction and to the entry of findings that he misappropriated a total of $134,047.65 from different bank trust accounts at his member firm’s affiliate.

FINRA’s findings stated that Raphael Huaman misappropriated the funds by having a colleague transfer money from the bank trust accounts to a separate affiliate account. Huaman then requested and obtained checks drawn on these accounts made out to third-party payees and deposited the checks into his personal bank account.

After the firm’s affiliate confronted Huaman regarding the transactions, he admitted his misconduct and the firm terminated his employment. The findings also stated that Huaman failed to respond to FINRA requests for information. (FINRA Case #2012034283301)

According to FINRA’s BrokerCheck, this broker was previously registered with FINRA at the following brokerage firm:

SUNTRUST INVESTMENT SERVICES, INC.
CRD# 17499
MIAMI, FL
01/2011 – 10/2012

This ends the information from FINRA’s website.

If you have experienced a financial loss due to your stockbroker or financial advisor’s recommendations, call Soreide Law Group for a free consultation with an attorney at: 888-760-6552.

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Mar/13

18

Florida Rep Barred by FINRA for Forging Client’s Signature and Misappropriation of Funds

Comments off · Posted by Securities Lawyer in FINRA

Soreide Law Group, a Securities Arbitration Law Firm, (888) 760-6552, found the following information on FINRA’s website under “Disciplinary and Other FINRA Actions, March, 2013.”

Johan Mary-Lyn Akal (CRD #4050242, Registered Representative, Sarasota, Florida)
was barred from association with any FINRA member in any capacity. This sanction was based on findings that Akal forged a bank customer’s signature on cash withdrawal slips and effected cash withdrawals from the customer’s account totaling $47,186.58 without the permission or authority from the customer or the bank, thereby misappropriating the funds. The bank later reimbursed the customer in full.

FINRA’s findings stated that Akal failed to respond to FINRA requests for information and testimony.
(FINRA Case #2011030662501)

This ends FINRA’s information from their website.

If you have experienced a financial loss call Soreide Law Group for a free consultation with an attorney at: 888-760-6552.

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Jan/13

23

Complaint Filed Against Florida Rep for Misappropriation of Funds Against Elderly

Comments off · Posted by Securities Lawyer in FINRA

The following information is from FINRA’s website under “Disciplinary and Other FINRA Actions, January, 2013.”

Kenneth Andrew Mauchin (CRD #2366345, Registered Principal, Sanford, Florida)

was named a respondent in a FINRA complaint alleging that he misappropriated $23,750 from elderly customers’ accounts by converting their funds to cashier’s checks and depositing those checks into a bank account of an entity he controlled.

FINRA’s complaint alleges that Mauchin did so without the customers’ knowledge or authorization. The complaint also alleges that Mauchin prepared a customer’s application for a variable annuity and falsely listed his bank branch office address as the customer’s mailing address, which he knew to be false.

Also, a customer applied for a premiere select IRA brokerage account with Mauchin’s firm and, without the customer’s knowledge or authorization, he falsely listed his bank branch office address as the customer’s mailing address, which he knew to be false. These applications became part of the firm’s books and records, causing his firm’s books and records to be false.

This complaint further alleges that Mauchin failed to appear for FINRA testimony.
(FINRA Case #2011028452701)

This ends the information from FINRA’s website.

Securities Lawyer, Lars K. Soreide, of Soreide Law Group, represents clients nationwide before FINRA. If you or a loved one 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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Dec/12

13

$42 Million Ponzi-Like Scheme Shut Down by SEC

Comments off · Posted by Securities Lawyer in FINRA

The Securities and Exchange Commission (SEC) announced that it obtained an emergency court order to halt an alleged Ponzi-like scheme operated by Small Business Capital Corp. and its principal Mark Feathers, who raised $42 million by selling securities issued by Investors Prime Fund LLC and SBC Portfolio Fund LLC – two mortgage investment funds they controlled.

The SEC alleges that over 400 investors were promised that profits from mortgage investments would yield annual returns of 7.5 percent or more. When in fact, Feathers operated a Ponzi-like scheme by paying returns to investors that came partly from fund profits and partly from other investors.

“Feathers raised millions from investors by promising high returns,” said John McCoy, Associate Regional Director of the SEC’s Los Angeles Office. “The returns turned out to be too good to be true and were funded in part with new investors’ money.”

In the SEC article they allege that from 2009 to early 2012, Feathers improperly transferred more than $6 million from the funds to Small Business Capital to pay its expenses, including substantial payments to Feathers.

Additionally, the SEC alleges that investors were not told that in February and March 2012, the defendants caused one fund to sell mortgages to the other fund at an inflated price, thus generating a “profit” for the selling fund so it could pay Small Business Capital management fees of more than $575,000. The SEC charged Feathers and Small Business Capital for Small Business Capital’s effecting transactions in the funds’ securities without being registered as a broker-dealer with the SEC.

If your broker recommended you invest in this product, call and speak to an attorney at Soreide Law Group for a free consultation on how to potentially recover your investment losses. Call 888-760-6552, or visit our website at: http://www.securitieslawyer.com.

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Nov/12

29

St. Petersburg, FL, Bank Manager Barred by FINRA for Misappropriation of Funds

Comments off · Posted by Securities Lawyer in FINRA

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

Brennan R. Lollar (CRD #5287737, Registered Representative, St. Petersburg, Florida)

was barred from association with any FINRA member in any capacity. The sanction was based on findings that Lollar misappropriated funds from a bank where he worked as a branch manager.

FINRA’s findings stated that without the bank’s permission or authority, Lollar transferred funds into customers’ accounts and labeled the transfers as refunds of bank fees. No bank fees had ever been assessed to the customers, and Lollar knew the customers we’re not entitled to any refunds. Through a series of several small transactions, Lollar misappropriated a total of $3,242.90 into customers’ accounts.

The FINRA findings also stated that Lollar admitted to the bank that he issued the false refunds and claimed that he did so to assist, or to curry favor with, certain customers. The bank obtained reimbursement through the liquidation of Lollar’s retirement fund.

The findings also included that other than Lollar providing FINRA with a photocopy of a written statement previously provided to the bank admitting to certain aspects of his misconduct, he did not respond to FINRA requests for information and failed to appear for a FINRA on-the-record interview.

(FINRA Case #2010024098101)
This ends the information from FINRA’s website.

Securities Lawyer, Lars Soreide, of Soreide Law Group, represents clients nationwide before FINRA. If you or a loved one 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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Nov/12

29

Jacksonville, FL, Rep Suspended and Fined for Insurance Scam

Comments off · Posted by Securities Lawyer in FINRA

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

Evan Coley Eggers (CRD #5205969, Registered Representative, Jacksonville, Florida)

fined $5,000 and suspended from association with any FINRA member in any capacity for six months. Without admitting or denying the findings, Eggers consented to the described sanctions and to the entry of findings that
he made premium payments for his customers’ life insurance policies, using his personal funds to make the payments.

FINRA’s findings stated that each payment was submitted to his member firm via a money order, a practice forbidden by company policy. On each money order, Eggers falsified the customer’s signature. On a couple of occasions, Eggers falsified the customer’s signature to reduce the value of a life insurance policy.

The FINRA findings also stated that all insurance policies at issue were less than one year old. By continuing payment of the premiums, all policies remained active through a period of 13 months, thus qualifying Eggers for potential remuneration.

The suspension is in effect from October 1, 2012, through March 31, 2013. (FINRA Case #2011026438701)

If you or a family member have become alleged victims of annuity or insurance fraud, 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.
Soreide Law Group, PLLC, representing Insurance Fraud Victims in Federal Court, State Court, and before the Financial Industry Regulatory Authority (“FINRA”).

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Nov/12

29

Roman Sledziejowki Defrauded Fellow Poles $4 mill

Comments off · Posted by Securities Lawyer in FINRA

FINRA, the Financial Industry Regulatory Authority, alleges Roman Sledziejowski, the Polish president and owner of TWS Financial, LLC, in Brooklyn, N.Y., used customer funds for his own use and gave false statements to clients from June, 2009, through August, 2012.

FINRA alleges Sledziejowski defrauded three Polish customers of more than $4 million by taking money out of their accounts, and in other cases, having them transfer funds that he said would be invested in a Polish vodka company. Mr. Sledziejowski refused to testify and cooperate with FINRA.

Sledziejowski told one client that his funds were being put into a Polish bank and the stock of a Polish vodka maker, but no such investments were ever made. Two other customers said they didn’t authorize the wire transfers that he made from their accounts to Innovest Holdings, LLC, which Sledziejowski controlled.

“In order to mask his misconduct, Sledziejowski provided customers with falsified account statements or ‘account snapshots,’ which were fictional accounts of their holdings in their TWS brokerage accounts or the values of those accounts,” FINRA said.

Sledziejowski was previously registered with Wachovia Securities LLC, Prudential Securities Inc. and Salomon Smith Barney Inc., according to FINRA’s BrokerCheck. TWS Financial filed to withdraw its broker-dealer registration on Nov. 9th.

If you have invested with Roman Sledziejowki, TWS Financial, LLC, or Innovest Holdings, LLC, and experienced financial losses, call and speak at no charge to a securities attorney who may potentially help you recover those losses. Call: 888-760-6552, or visit our website at: http://www.securitieslawyer.com.

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

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Nov/12

27

Charles Bishop, Jr., Pompano Beach, FL, Fined and Suspended by FINRA for Misappropriation of Funds (aprox. $3mill) from an Elderly Client

Comments off · Posted by Securities Lawyer in FINRA

The following information was found on FINRA’s website’s “Disciplinary and Other Actions, November, 2012.”

Charles Eugene Bishop Jr. (CRD #1621380, Registered Principal, Pompano Beach, Florida)

submitted an Offer of Settlement in which he was fined $7,500 and suspended from association with any FINRA member in any capacity for two years. Without admitting or denying the allegations, Bishop consented to the described sanctions and to the entry of findings that he attempted to misappropriate approximately $3 million from an elderly customer of his member firm.

These findings stated that Bishop created paperwork by which the deceased customer’s assets would be transferred to a purported entity that was never
formed, but whose name was virtually identical to a company the customer owned, with a tax identification number assigned by the Internal Revenue Service (IRS) to another entity that was never formed, but whose sole member, according to IRS records, was Bishop.

Bishop had the customer sign a firm form that designated Bishop’s entity, although the customer’s signature on the form was notarized, the customer was not present before the notary when the signature was notarized.

The beneficiary’s tax identification number on another firm form the customer signed was changed to the tax identification number for the purported entity associated with Bishop as sole member. The signature date of the form was not altered or changed, and the customer did not initiate the change of
the tax identification number. The findings also stated that after the customer passed away, Bishop, through his attorney, filed a notice with a Probate Division with his state’s Circuit Court representing that he had an interest in the customer’s estate as a claimant and beneficiary of the deceased customer’s estate.

Following Bishop’s termination of employment from his firm, the court issued an order invalidating the beneficiary designations that were on file at Bishop’s firm for the customer’s securities accounts.

The suspension will be in effect from December 3, 2012, through December 2, 2014. (FINRA Case #2009017699201)
(This ends the information on the Disciplinary Actions.)

On FINRA’s website under ‘BrokerCheck’ there are pending customer disputes and 7 final customer disputes listed. He also has 1 regulatory event, 1 pending financial, and 1 final termination. The last three firms of employment, all in Ft. Lauderdale, Florida, were listed as, National Asset Management, Merrill Lynch, Pierce, Fenner and Smith, Inc., and Morgan Stanley.

Currently, Soreide Law Group has pending FINRA arbitrations against Charles E. Bishop, Jr. If you had invested with Charles Eugene Bishop, Jr., and experienced financial losses, call and speak at no charge to a securities attorney who may potentially help you recover your losses. Call 888-760-6552, or visit http://www.securitieslawyer.com.

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Nov/12

26

Former Boston Merrill Lynch Financial Advisor Facing Securities Fraud

Comments off · Posted by Securities Lawyer in FINRA

Jane E. O’Brien, 59, of Needham, MA, is facing securities fraud for allegedly bilking her client out of $240,000. O’Brien was working for Merrill Lynch in Boston as a financial advisor at the time. O’Brien allegedly told an elderly woman she was investing her money in thousands of shares of a New Hampshire-based company called A.C. Corp. When actually O’Brien was using her client’s money to pay off her own mortgage and settle her legal fees involving a dispute with another client, according to charges filed November 18th., 2012, by federal prosecutors.

This alleged scheme began in 2009, when O’Brien had her client sign a bogus promissory note for $500,000. The client began making payments on the note in late November 2009, prosecutors said. She wrote the checks to a man O’Brien said was an employee at A.C. Corp., but was in reality O’Brien’s husband, the filing said. The husband has not been named and has since separated from O’Brien, according to the filing.

It was reported that after the checks were paid to O’Brien’s husband, he then wrote her checks from the account where the money had been deposited. O’Brien then wired money to her mortgage company to pay her mortgage. Other payments made were used for payment to a law firm representing O’Brien in another dispute with a former client.

Securities Lawyer, Lars Soreide, of Soreide Law Group, has begun an investigation into this matter. If you have invested with Jane E. O’Brien, formerly of Merrill Lynch in Boston, call and speak at no charge to a securities attorney who may potentially help you recover your losses. Call 888-760-6552, or visit http://www.securitieslawyer.com.

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Oct/12

18

FINRA Report on Misappropriating Customers Funds

Comments off · Posted by Securities Lawyer in FINRA

FINRA publishes this quarterly review to provide firms with a sampling of recent disciplinary actions involving misconduct by registered representatives. This sample includes settled matters and decisions in litigated cases (National Adjudicatory Council (NAC) decisions and SEC decisions in FINRA cases). These summaries call attention to, and remind registered representatives and member firms of, specific conduct that violates FINRA rules and may result in disciplinary action.

The following was published on FINRA’s website, October, 2012

“Fraudulently Misappropriating Customer Funds”

FINRA settled a matter involving a registered representative who misled two
customers to convince them to transfer approximately $100,000, which the registered representative subsequently misappropriated. The registered representative fraudulently misrepresented to one customer that he would use the customer’s money to purchase corporate bonds.

In response, the customer transferred $47,000 from his brokerage account to the registered representative. This registered representative deposited the
funds into his personal bank account, used the money for personal expenses and never purchased the corporate bonds.

The registered representative indicated to a second customer that he would use the customer’s funds to purchase a certificate of deposit (CD). The customer transferred approximately $53,000 to the registered representative
for the purchase. The registered representative deposited the funds into his personal bank account and used the money to cover personal expenses. He did not purchase the CD.

FINRA found that the representative’s conduct violated Section 10(b) of the Exchange Act (fraud); Exchange Act Rule 10b-5 (fraud); NASD Rules 2120** (fraud), 2330(a)† (customers’ securities or funds) and 2110‡ (ethical standards), and FINRA Rules 2150(a) (improper use of customer funds) and 2010 (ethical standards).

Because of the registered representative’s violations, FINRA barred him from associating with any firm in any capacity.
(This ends the FINRA article.)

Securities Lawyer, Lars K. Soreide, of Soreide Law Group, PLLC, represents clients nationwide. For a free consultation on how to potentially recover your 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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