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Monday, September 15, 2014

Morgan Stanley Smith Barney Fined by CFTC for Failing to Abide by its “Know Its Customer” Practice

Morgan Stanley Smith Barney (MSSB) was fined $280,000 by the U.S. Commodity Futures Trading Commission (CFTC) today on the same day an Order was filed against them. The charges claimed that MSSB neglected to supervise their employees' handling of accounts, specifically in SureInvestment, a group of companies. Under its own guidelines and procedures labeled the "Enhanced Due Diligence and Customer Identification Program," MSSB was required to "Know Its Customer" as well as to apprise itself of any activity deemed suspicious prior to the accounts being opened. The order found MSSB negligent on those counts among others, including failing to produce documents and account records in an accurate and timely manner upon request of the CFTC. For the release, please see the link below:

In The San Francisco Chronicle on Sunday...

I discussed the stricter review of settlements between Silicon Valley companies and class action lawyers.  The entire article, along with my views, can be viewed at the link below.

Friday, September 12, 2014

Legal Options for Jack Tawasha Related Investment Losses

Did you lose money with former investment adviser Jack Tawasha?  If so, those investment losses may be recoverable against his former employers, including Wells Fargo and Ryan Beck & Co.  Tawasha was with Wells Fargo from November of 2006 until March 2014.  He has one regulatory event, two customer complaints, two terminations and one judgement/lien against him.  He was recently barred from the securities industry by his main regulator, FINRA. The good news for his previous clients is they can sue his previous employers for any investment losses sustained.  To learn how to do this and the legal grounds for a contingency lawsuit or FIRNA arbitration claim against his employers, please call our securities fraud law firm in Chicago, Illinois

Investment Losses In Frontier Funds?

FINRA issued a warning for investors on the dangers of investing in frontier markets. The release, entitled Frontier Funds—Travel With Care, provides investors with a series of tips to avoid problems investing in these funds.  The recommendations include... -Know which frontier markets the fund invests in. Risk factors vary by country—and no two countries share identical risk elements. -Monitor changes in index components. If you are investing in a frontier ETF or index mutual fund, make sure you know and understand the index that the fund tracks and also the components of that index. The countries included in a frontier index can change over time. -Geopolitical and currency risks are real. Be aware that some frontier markets are located in parts of the world with unstable political or market environments. -Factor in costs and fees. Frontier fund costs and fees can be higher than their emerging market peers, and significantly higher than broadly diversified domestic and international managed funds. -Consider Performance History. Frontier funds are relatively new, and most have limited performance histories. Given the large recent returns in these funds, it is likely financial advisors and brokers are recommending these funds to investors in heavy concentrations.  Unfortunately, in some cases these might be unsuitable and inappropriate investments based on the client's age and actual investment objectives.  The extent of the problem likely won't be known until the frontier markets crash.  To learn how frontier market related investment losses can be recovered, please call our securities fraud team.  

FINRA Narrows It Down To Two For New Arbitration Head

FINRA has narrowed it down to two veterans to replace Linda Fienberg, the former head of its dispute resolution forum.  It's down to Richard Berry, the unit's director of case administration, or Kenneth Andrichik, its mediation director.   No due date for a decision has been set.   The article below provides more detail.

Investment Losses With David Diehl in KABDAD/Its a Better Burger?

Did you lose money with financial advisor David Diehl? If so, those investment losses might be recoverable through his former employers, First Liberties, Workman Securities Corp., U.S. Bancorp, Berthel Fisher, USAllianz, and Vestpoint Securities. This month we filed a FINRA arbitration claims against First Liberties for sales to our client of a purported investment in a company called KABDAD, Inc., a Missouri Corporation, which was a company that owned restaurants in the St. Louis area called "It's A Better Burger".   According to publicly available incorporation documents, the company's principal place of business and corporate headquarters is 314 Addyston Pointe, St. Peters, Missouri, which is the same address as Agent Diehl's office as represented on our client's account statements.  The investment security came in the form of a promissory note which was dated June 1, 2011.  After making quarterly interest payments until September 2013,  Agent Diehl informed our client that the restaurants were not successful and that he could no longer afford to pay interest or principal on the note. Diehl was employed with First Liberties and operated a branch office for First Liberties located at 17295 Chesterfield Airport Road, Ste. 200, Chesterfield, Missouri 63005.  Diehl was registered with First Liberties from July 2010 to March 2012.  Diehl was then registered with Sunbelt Securities for approximately one month until he was "permitted to resign" as a result of a FINRA investigation into Diehl's conduct when he was registered with First Liberties. Prior to his registration with First Liberties, Diehl was registered with Workman Securities Corp., U.S. Bancorp, Berthel Fisher, USAllianz, and Vestpoint Securities. In all, Diehl was registered with seven different broker/dealers in eight years. Diehl also operated an investment related DBA called Diehl Wealth Management Group, which was registered as an investment advisory firm. If you lost money investing with David Diehl in KABDAD, please call our securities law firm in Chicago and Barrington, Illinois for a free consultation by a lawyer to learn about contingency fee lawsuit and FINRA arbitration options.

Friday, August 29, 2014

Update for Victims of Blake Richards and How LPL Can Be Sued

Good news for victims of digraced former LPL financial stockbroker Blake Richards.  This week Richards was ordered to pay nearly $2 million in disgorgement and penalties after scamming investors out of $1.8 million.  The ruling Thursday came as part of a summary judgment by Judge Willis B. Hunt Jr. on Thursday.  Starting in 2008, Blake B. Richards instructed at least seven clients to write checks to entities he controlled, such as "Blake Richards Investments" or "BMO Investments," with the understanding that those funds would be invested in fixed-income investments, variable annuities or equities, according to a case filed in the U.S. District Court of the Northern District of Georgia. Instead, those funds went to pay his personal expenses, the Securities and Exchange Commission said, and Mr. Richards would provide fictitious account statements.  For clients who were burned by Blake Richards, LPL can be sued for issues related to its supervision of him.  One way LPL can be held liable for these losses is if they failed to reasonably supervise him during the time he was affiliated with the firm.  To discover how LPL can be sued for these investment losses, please call our securities fraud law firm for a no cost evaluation.

Legal Options for Churning Victims of Douglas Leone, Andre LaBarbera, David Levy, Antonio Costanzo and Donald Barte

New York-based Newport Coast Securities Inc. and five brokers from the firm allegedly churned customer accounts, according to FINRA. From September 2008 to May 2013, brokers Douglas Leone, Andre LaBarbera, David Levy, Antonio Costanzo and Donald Barte churned accounts of 24 customers, using margin and risky securities to generate huge commissions, wiping out most of the customers' capital in the process. Losses amounted to more than $1 million. In addition, those brokers created new account forms for clients that misstated their net worth, investment experience and objectives. To lear how to sue these individuals for churning losses on a  contingency fee basis, please call our securities fraud legal team in Chicago and Barrington, Illinois.

Thursday, August 28, 2014

Legal Options for Burned Clients of Disgraced Financial Adviser Matthew J. Davis

Many victims of disgraced Corona, California financial adviser Matthew J. Davis are trying to figure out how the converted funds can be recovered.  The good news is that clients may have valid claims against Beneficial Investment Services, Inc. and Oneamerica Securities, Inc. for failing to reasonably supervise him during the time he was affilaited with the firm. Recently, Matt Davis (CRD# 4412731) entered into a Letter of Acceptance, Waiver and Consent with the Financial Industry Regulatory Authority (FINRA) Department of Enforcement to resolve allegations FINRA made against him regarding violations of securities industry rules. Davis agreed to a permanent bar from associating with any FINRA member firm in any capacity.  FINRA alleged that Davis refused to appear to give testimony for a FINRA on-the-record interview regarding allegations that he engaged in misconduct in several customer accounts, including claims of conversion, misrepresentation of customer holdings and account values, forgery of account related documents, discretionary and/or unauthorized trading, efforts to settle a customer complaint away from his member firm, and unsuitable investment recommendations.  To learn about suing Beneficial Investment Services, Inc. and Oneamerica Securities, Inc for these actions, please call our securities fraud legal team for a no cost review for how these losses can be recovered on a contingency fee basis.

Burned in Geneva Exchange Fund tenant-in-common (TIC)?

Clients who got suckered into buying high commissioned tenant-in-common interests at the recommendation of their broker contoinue to sue the brokerage firms who peddled the products.  Many clients who bought Geneva Exchange Fund tenant-in-common have valid legal claims against the brokerage firms who peddled this product.  Many of the clients who bough the Geneva Exchange Fund tenant-in-common might have valid claims for the suitability of the transaction or for the broker not disclosing the main, material risks of the investment.  For these clients, the FINRA arbitration claims process can be used the recover these losses.  For a free legal analysis by a securities fraud lawyer, please call us.
Geneva Exchange Fund tenant-in-common (TIC)