Securities Lawyer Blog | Victim of Fraud?

TAG | securities fraud lawyer

Mar/13

26

Arete Wealth Management Fined and Censured by FINRA for Lack of Due Diligence

Comments off · Posted by Securities Lawyer in FINRA

The following is a summary of information that appeared on FINRA’s website:

Arete Wealth Management, LLC (CRD #44856, Schaumburg, Illinois)

was censured and fined $25,000. Without admitting or denying the findings, the firm consented to the described sanctions and to the entry of findings that it approved a private offering to customers and failed to perform adequate due diligence. FINRA’s findings stated that the Securities and Exchange Commission (SEC) determined that the umbrella corporation that owned the fund was involved in fraudulent activity; even though the fund was not directly involved in the fraud, the SEC seized the fund’s assets. The firm failed to sufficiently document its due diligence. In connection with two other private offerings, the firm failed to document that adequate due diligence had been performed. In each of the three offerings, the firm’s files did not contain documentation evidencing a meaningful investigation or critical analysis of the offerings.

ARETE WEALTH MANAGEMENT, LLC
CRD# 44856
SEC# 8-50854
Main Office Location:
1699 E. WOODFIELD RD.
SUITE 565
SCHAUMBURG, IL 60173

This ends the information from FINRA’s website.

If you were a client of Arte Wealth Management and 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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Feb/13

8

Crystallex International Corporation (“CRYXF”)

Comments off · Posted by Securities Lawyer in FINRA

Crystallex has commenced a proceeding under chapter 15 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware in order to ensure that relevant CCAA orders are enforced in the United States. Many stock brokers recommended CRYXF to their clients as an undervalued mining company that is poised for a big jump. This investment may not have been suitable for conservative investors. If your stock broker recommended a significant investment into Crystallex recently you may be able to recover some or all of your investment losses.

On December 23, 2011, Crystallex received an initial order from the Ontario Superior Court of Justice granting CCAA protection until January 21, 2012. Proceedings by creditors cannot be continued or commenced without the consent of the Company and Ernst & Young Inc. (the Monitor) or leave of the Court. The Court extended the stay until March 23, 2012. The Court approved the terms of an interim bridge loan for Crystallex in the amount of US$3.125 million. The bridge loan is a secured, short term loan, due the earlier of April 16, 2012 or the first draw on a debtor-in-possession (“DIP”) financing facility, and is intended to provide the Company with working capital while it continues to pursue DIP financing and progress its arbitration claim.

Crystallex International Corporation is a Canadian based mining company, with a focus on acquiring, exploring, developing and operating mining projects. Crystallex has operated an open pit mine in Uruguay and developed and operated three gold mines in Venezuela.

Call (888) 760-6552 if your stock broker recommended you purchase Crystallex CRYXF.

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Jan/13

31

FINRA Wants to Change Public Arbitrator Qualifications

Comments off · Posted by Securities Lawyer in FINRA

The Financial Industry Regulatory Authority Inc., also known as FINRA, is proposing to tighten its definition of “public” arbitrator. FINRA would like to exclude people associated with a mutual fund or hedge fund from its pool of public arbitrators and require others to wait for two years after ending an industry affiliation before being classified as a public arbitrator, writes Dan Jamieson in an article from the InvestmentNews.com.

On the Securities and Exchange Commission’s website, Finra said the change “would improve investors’ perception about the fairness and neutrality of Finra’s public arbitrator roster.”

FINRA is proposing a two-year cooling-off period for attorneys, accountants and others who have done a certain amount of work for securities industry clients, and for those who work for or serve as officers or directors of entities controlled by securities firms. This two-year wait would cover spouses and immediate family members of such individuals as well.

“In one instance, an individual applying to be a public arbitrator had retired one month earlier from a lengthy career at a law firm that represented securities industry clients,” FINRA said in its filing.

FINRA already has a five-year waiting period for former securities industry employees wishing to serve as public arbitrators, and bans those associated with the industry for at least 20 years from ever becoming public arbitrators.

Many feel Finra needs to go further and eliminate anyone who has had any connection with the industry as an arbitrator.

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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Jan/13

22

Harrisburg, PA, Rep Barred by FINRA

Comments off · Posted by Securities Lawyer in FINRA

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

David Scott Isolano (CRD #2504880, Registered Principal, Harrisburg, Pennsylvania)

was barred from association with any FINRA member in any capacity. Without admitting or denying the findings, Isolano consented to the described sanction and to the entry of findings that he failed to respond to a FINRA request to appear for on-the-record testimony concerning an investigation into fixed income transactions executed with excessive markups.

(FINRA Case #2009019803302)

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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Jan/13

14

SEC’s Statistics Positive News for Investors

Comments off · Posted by Securities Lawyer in FINRA

The Securities and Exchange Commission, also known as the ‘SEC,’ has filed 734 enforcement actions the fiscal year that ended Sept. 30, 2012. That is one less than last year’s record of 735.

The SEC’s report should remind investors that investment fraud is still a threat to investors. The SEC filed 147 enforcement actions in 2012 against investment advisors and investment companies, one more than 2011’s record number. The SEC filed 134 enforcement actions related to broker-dealers, a 19% increase over 2011.

On the positive side for investors, the SEC was able to secure more payments for the victims of the fraud. The SEC was able to secure over $3 billion in penalties and disgorgement in 2012 for wronged investors. This is an increase of 11 % over the 2011.

In 2011 and 2012, the SEC obtained orders for $5.9 billion in penalties and disgorgement for the investors who became victims of fraud.

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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Jan/13

9

Did You Invest in Wells Timberland REIT?

Comments off · Posted by Securities Lawyer in FINRA

Soreide Law Group is currently investigating the Wells Timberland REIT for the investors who suffered financial losses. FINRA, the Financial Industry Regulatory Authority, fined Wells Investment Securities $300,000 for improper sales materials when selling the Wells Timberland REIT, from May 2007 to September 2009. (Wells Investment Securities neither admitted nor denied the charges.)

FINRA stated that the marketing materials for the Wells Timberland REIT contained 116 “improper, unwarranted or exaggerated statements.” FINRA further stated that various information concerning diversification, distributions and redemptions of the REIT was misleading.

“By approving and distributing marketing materials with ambiguous and equivocal statements, Wells misled investors into thinking Wells Timberland was a REIT at a time when it was not a REIT,” said Brad Bennett, FINRA executive vice president and chief of enforcement, in a statement.

If you or a loved one invested in the Wells Timberland REIT due to your stock broker or financial advisor’s recommendation call Securities Lawyer, Lars Soreide, of Soreide Law Group at: 888-760-6552, or visit www.securitieslawyer.com.

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Jan/13

8

Did You Invest in Private Placement Funds with Gramercy Securities?

Comments off · Posted by Securities Lawyer in FINRA

Securities Lawyer, Lars Soreide, of Soreide Law Group, is currently investigating Gramercy Securities, Inc. This brokerage has been alleged to have placed unsophisticated investors’ money into unsuitable investments. There have been claims, for example, of a recent widow losing her entire net worth by investing in risky private placements. Some of these risky private placements were in the Inland American Real Estate Investment Trust, LaeRoc Edge Funds, and Arciterra Whitefish Opportunity Fund.

LaeRoc funds are real estate private placements. LaeRoc Partners is a real estate investment firm managing over $650 million in assets. The LaeRoc private placement was promoted by brokers as a safe or conservative investment. These representations allegedly were misleading.

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

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Jan/13

7

Broker Jason T. Knapp Arrested in Alleged Ponzi Scheme

Comments off · Posted by Securities Lawyer in FINRA

Jason T. Knapp, Corinth, New York, was arrested in connection with a nationwide Ponzi scheme, which allegedly involves hundreds of thousands of dollars. Knapp was a registered representative of Dawson James Securities of Boca Raton, FL, and had raised investment capital with a company call SteepleChase Group, making claims that returns on investments would be over 18%. He was terminated in June, 2012, because he allegedly falsified internal documents and documents that were provided to customers.

Knapp is charged with second-degree larceny for allegedly stealing from a New York investor. There are also several victims from Boca Raton, FL.
There are currently investigations in Florida, Arizona, Rochester, New York City
and Maryland.

If you feel you may have a claim against former broker Jason Knapp call 888-760-6552.

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. Visit our website at: http://www.securitieslawyer.com.

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Dec/12

18

Morgan Keegan Fined and Censured by FINRA Over Sales of ETFs

Comments off · Posted by Securities Lawyer in FINRA

Recently, Morgan Keegan entered into a settlement with FINRA for conduct surrounding non traditional etfs sold to retail customers. The following is information from FINRA’s website.

Morgan Keegan & Company, Inc. (CRD #4161, Memphis, Tennessee)

submitted a Letter of Acceptance, Waiver and Consent in which the firm was censured and fined $365,000. The firm consented to the described sanctions and to the entry of findings that it failed to establish and maintain a supervisory system, including written procedures reasonably designed to achieve compliance with NASD® and/ or FINRA rules in connection with the sale of Non-Traditional Exchange-Traded Funds (NonTraditional ETFs) in accounts where the firm provided brokerage services to certain retail customers, and failed to provide adequate formal training to its registered representatives and supervisors regarding the features, risks and characteristics of Non-Traditional ETFs.

Also, the findings stated that the firm supervised Non-Traditional ETFs as it supervised traditional ETFs until FINRA issued its June, 2009, Regulatory Notice. Morgan Keegan relied on its general supervisory procedures to supervise transactions in Non-Traditional ETFs during the relevant period, but the general supervisory system the firm had in place was not sufficiently tailored to address the unique features and risks involved with these products. They did not create a procedure to address the risks associated with longerterm holding periods in Non-Traditional ETFs.

FINRA’s findings also stated that the firm allowed certain of its registered representatives to recommend to customers a Non-Traditional ETF without performing reasonable diligence to understand the risks and features associated with it.
(FINRA Case #2009019113501)

Securities Attorney, Lars Soreide, of Soreide Law Group, PLLC, has represented clients nationwide. If you have sustained investment losses due to your stock broker or financial advisor’s recommendations regarding ETFs, 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

17

FINRA Broadens Suitability Rule

Comments off · Posted by Securities Lawyer in FINRA

FINRA, the Financial Industry Regulatory Authority, has eased up on a controversial interpretation of its new suitability rule in a move that is bound to make the industry happy writes Dan Jamieson in a recent artilce in InvestmentNews.com.

The new guidance issued December 10th., 2012, FINRA backtracked from an earlier interpretation of the rule, which said that people who were not customers, and investment strategies that did not involve securities, were covered under the suitability rule. But in the Regulatory Notice 12-55, Finra now says the rule applies only to customers who open an account or buy a product for which the brokerage firm receives compensation. Also, the new notice says the suitability rule does not apply to recommendations of non-security products made as part of an individual broker’s outside business activity writes Jamieson.

However, a firm’s “suitability analysis also must be informed by a general understanding of the non-security component of the recommended investment strategy,” FINRA said in it’s notice.

For example, independent registered representatives often sell insurance and engage in investment advisory activities outside of their broker-dealers, which brokerage firms must approve of and track under FINRA’s outside-business-activity rules. FINRA also said that its new suitability rule would generally not create a continuing duty to monitor an investment or strategy.

The InvestmentNews.com article adds that the new guidance was welcomed by industry lawyers, who have complained that the earlier guidance, issued in May, caught the industry by surprise.

FINRA spokeswoman Nancy Condon wrote that the self-regulator wanted to clarify “issues relating to who is considered a ‘customer’ and provide greater detail on what investment strategies are covered.”

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 through a FINRA arbitration. To speak with an attorney call 888-760-6552, or visit our website at: http://www.securitieslawyer.com.

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