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TAG | unsuitable investments

Mar/13

20

Jacksonville, FL, Rep Fined and Suspended by FINRA

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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.”

Alan Richard Joyce (CRD #1683601, Registered Principal, Jacksonville, Florida)

was fined $7,500 and suspended from association with any FINRA member in any capacity for 60 business days. Without admitting or denying the findings, Joyce consented to the described sanctions and to the entry of findings that he recommended stock and mutual fund transactions in a customer’s account without having reasonable grounds for believing that such transactions were suitable in view of the customer’s account objectives and financial situation and needs. The findings stated that the customer won lottery proceeds in her home state. In connection with the opening of the customer’s account with Joyce’s member firm, an Index Advisory Service Agreement was executed that set forth the parties’ responsibilities as it pertained to the measuring index, which basically represented the desired asset allocation to be maintained in the account.

FINRA’s findings also stated that the Index Agreement required that Joyce, on the firm’s behalf, assist the customer in determining an initial measuring index, consult with the customer in making changes to the measuring index, and obtain final approval of the measuring index (as well as any recommended changes to the measuring index) from a third party assisting the customer in the handling of her lottery winnings. Over the course of a year, the account suffered losses of approximately $183,355.57, resulting in a balance of $48,720.64. With little remaining assets in the account, and distributions continuing at the same rate, the balance had further dwindled and a final distribution of $4,281.33 was sent to the customer. Joyce received $2,457.32 in total compensation for handling the account.

FINRA found that at various times, Joyce exercised discretionary power in the trust account established for the customer’s benefit, without the trustee’s written authorization to place discretionary trades and without his firm’s written acceptance of the account as discretionary.

The suspension is in effect from February 4, 2013, through April 30, 2013. (FINRA Case #2010024156301)

The following information is from FINRA’s BrokerCheck:

Alan Richard Joyce is currently employed by and registered with the following FINRA Firm(s):

RAYMOND JAMES & ASSOCIATES, INC.
245 RIVERSIDE AVENUE
SUITE 500
JACKSONVILLE, FL 32202
CRD# 705
Registered with this firm since: 10/3/2003

Alan Richard Joyce was previously registered with FINRA at the following brokerage firms:

DEUTSCHE BANK SECURITIES INC.
CRD# 2525
NEW YORK, NY
01/2001 – 10/2003

DB ALEX. BROWN LLC
CRD# 17790
BALTIMORE, MD
12/1999 – 01/2001

PRUDENTIAL SECURITIES INCORPORATED
CRD# 7471
NEW YORK, NY
08/1998 – 09/1998

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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Jan/13

10

FINRA Fines Total Over $68 Million in 2012

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FINRA, the Financial Industry Regulatory Authority levied a total of $68 million in civil fines during 2012, according to statistics released by FINRA on Tuesday, January 8, 2013. This was slightly less than $71.9 million imposed by FINRA in 2011. The high-profile cases against large brokerages accounted for about one-third of total fines in 2012.

It was also noted that FINRA ordered brokerages to repay harmed investors a record $34 million.

FINRA oversees about 4,290 brokerages and 630,000 brokers.

Many of FINRA’s cases against Wall Street’s largest brokerages in 2012, including Morgan Stanley, Merrill Lynch, UBS, AG, and Wells Fargo Corp. These cases stem from FINRA’s increased interest in potential conflicts of interest and complex products, such as certain types of exchange-traded funds, said Richard Ketchum, FINRA’s chairman and chief executive, in an interview with Reuters.

These priorities “will result in more cases against large firms because they’re the ones engineering those products and the ones that have many of the conflicts because of their complexity,” Ketchum said. For example, brokerage units that underwrite offerings of certain risky products stand to profit when retail brokers in the same firm boost sales of those products by pushing them to investors, even though they may not be suitable.

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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Mar/12

21

BROOKSTREET CEO ORDERED BY JUDGE TO PAY $10 MILLION PENALTY IN SEC CASE

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THE FOLLOWING ARTICLE WAS OBTAINED FROM THE SEC’S WEBSITE:

“On March 1, 2012, a federal judge ordered the former CEO of Brookstreet Securities Corp. to pay a maximum $10 million penalty in a securities fraud case related to the financial crisis.

In December of 2009, the U.S. Securities and Exchange Commission filed a civil injunctive action against Brookstreet Securities Corp. and Stanley C. Brooks, charging them with fraud for systematically selling risky mortgage-backed securities to customers with conservative investment goals. Brookstreet and Brooks developed a program through which the firm’s registered representatives sold particularly risky and illiquid types of Collateralized Mortgage Obligations (CMOs) to more than 1,000 seniors, retirees, and others for whom the securities were unsuitable. Brookstreet and Brooks continued to promote and sell the risky CMOs even after Brooks received numerous warnings that these were dangerous investments that could become worthless overnight. The fraud resulted in severe investor losses and eventually caused the firm to collapse.

On February 23, 2012, the Honorable David O. Carter entered an order granting summary judgment in favor of the Securities and Exchange Commission. He found Brookstreet and Brooks liable for violating Section 10(b) of the Securities Exchange Act of 1934 as well as Rule 10b-5. On March 1, 2012, the court entered a final judgment and ordered the financial penalty sought by the Securities and Exchange Commission. In addition to the $10,010,000 penalty, Brooks was ordered to pay $110,713.31 in disgorgement and prejudgment interest. The court’s judgment also enjoins both Brookstreet and Brooks from violating Section 10(b) of the Exchange Act as well as Rule 10b-5.”

THIS ENDS THE SEC’S ARTICLE.

Securities Lawyer, Lars K. Soreide, of Soreide Law Group, PLLC, has represented clients nationwide. If you or a family member 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: www.securitieslawyer.com.

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

 

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Feb/12

23

Lars K. Soreide, of Soreide Law Group, Files a FINRA Arbitration Against National Securities Corporation for the Sale of Roundstone Healthcare Capital Partners

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Lars K. Soreide, of Soreide Law Group, PLLC, filed a FINRA arbitration in February of 2012, against National Securities Corporation alleging: negligence, negligent supervision, and breach of fiduciary duty, due to among other unsuitable investments, the sale of Roundstone Healthcare Capital Partners. Recently, Roundstone Healthcare Partners, and its affiliates, have filed a RICO suit against numerous defendants in “GREENFISH II, L.P. et al v. INTERNATIONAL PORTFOLIO, INC. et al,” which alleges that Roundstone and their affiliates were sold portfolios of medical receivables at artificially inflated values with no real ability to resell. Roundstone then, through stock brokers and financial advisors, sold these receivables to the general public states securities attorney, Lars K. Soreide.
 
Roundstone Healthcare Capital has purchased more than $2 billion of discounted portfolios of hospital patient-care receivables. The firm receives returns for its investors through collection efforts and the eventual resale of the portfolios into the secondary credit collection markets. Many brokers and broker dealers recommended this investment to their customers with doing little or no due diligence.
 
If you have invested in a Roundstone receivable through your stock broker or financial advisor contact Lars K. Soreide, today at (888) 760-6552 or visit our website at: http://www.securitieslawyer.com
 
 

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Nov/11

16

FINRA Fines JPMorgan Unit $1.7M for Putting Conservative Clients in Unsuitable Investments

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 In a November 15th., 2011, Bloomberg Businessweek article they write that a unit of JPMorgan Chase & Co. was ordered to reimburse investment customers more than $1.9 million and was fined $1.7 million over how it sold unit investment trusts and floating-rate loan funds.

FINRA, the Financial Industry Regulatory Authority announced the settlement on Tuesday after its investigators found that brokers with Chase Investment Services Corp. made purchase recommendations to investors who weren’t suited to the complex investments. The securities industry’s self-regulatory body, FINRA, said that the products were pitched to “unsophisticated customers with little or no investment experience and conservative risk tolerances.”

The Bloomberg article goes on to say that FINRA also faulted Chase’s supervisory procedures to monitor sales of UITs and floating-rate loan funds. Chase did not provide brokers with sufficient training and guidance regarding the risks and suitability of UITs and floating-rate funds.

A UIT is decribed as an investment in baskets of diversified securities which can include high-yield bonds. That category, also known as junk bonds, can earn investors greater returns than investment-grade bonds, but junk bonds also are more volatile, with a higher risk of loss.

The description of floating-rate loan funds are mutual funds that invest in short-term bank loans made to companies whose credit is rated below investment grade. The income that investors receive adjusts with changes in the interest rate that banks charge on the loans.

The Bloomberg article says that Chase brokers made almost 260 unsuitable recommendations to purchase UITs to customers, FINRA said. Those customers suffered losses of about $1.4 million as a result of their purchases.

FINRA said the floating-rate loan funds that Chase sold were subject to significant credit risks, and some were invested in assets that could not easily be sold and converted to cash. Customers suffered losses of nearly $500,000 as a result of Chase’s recommendations, FINRA said.

In concluding the settlement, Chase neither admitted nor denied the findings, but consented to them, FINRA said.

Securities Attorney, Lars Soreide, of Soreide Law, PLLC, has represented clients nationwide. If you or a family member have experienced losses through JP Morgan Case & Co., or Chase Investment Services Corp., 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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Jul/11

21

FINRA Suspends Former NEXT Financial Broker, for Two Years for Improper Trading in Customer Accounts

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WASHINGTON —It was announced July 20, 2011, on FINRA’s website that The Financial Industry Regulatory Authority (FINRA) has suspended William Bailey, a former NEXT Financial Group, Inc. broker of Mesa, Arizona, from the securities industry for two years for unsuitable and excessive trading of mutual funds and variable annuities. Bailey also engaged in discretionary trading without receiving prior written approval from his customers.

It was reported that FINRA found between January 2006 and December 2007, Bailey recommended 484 short-term mutual fund switch transactions in seven customer accounts. In each of the accounts, Bailey, on his customers’ behalf, repeatedly sold mutual funds less than one year after purchasing them, and purchased new mutual funds with the proceeds. With Bailey’s frequent switches, on average, his customers held their mutual funds for only 60 days. The seven customers, who ranged in age from 66 to 93 and were all unsophisticated investors, incurred over $147,000 in sales charges and trading fees. Bailey received over $120,000 in commissions from these sales. To facilitate his mutual fund trading scheme, Bailey frequently traded in his customers’ accounts without first obtaining their permission and improperly completed customer account forms to make it appear the customers approved of the trading.

 In the FINRA article it was reported that FINRA also found Bailey convinced three customers to switch their variable annuities for new ones after holding them for a short period of time. These exchanges were unsuitable based on the customers financial objectives and needs, and did not improve the customers’ financial situations.

 Mr. Brad Bennett, FINRA Executive Vice President and Chief of Enforcement, said, “Brokers who engage in excessive trading will be held accountable. In this case, Mr. Bailey rapidly switched his elderly and unsophisticated customers in and out of mutual funds with high costs, providing a benefit to Bailey instead of to his customers.”

In settling this matter, Bailey neither admitted nor denied the charges, but consented to the entry of FINRA’s findings.

This information was obtained on FINRA’s website.

Securities Attorney, Lars Soreide, of Soreide Law, PLLC, has represented clients nationwide. If you or a family member feel you have become a victim of William Bailey or Next Financial Group, Inc., or a similar situtation, 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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