Articles Tagged with Dawn Bennett

shutterstock_172399811-297x300Our law offices are continuing its investigation and the recent developments in the Dawn Bennett (Bennett) case.  Recently the Financial Industry Regulatory Authority (FINRA) filed a complaint alleging that Bennett sold $6 million in promissory notes concerning her retail clothing business – DJBennett.com owned by DJB Holdings, LLC.  As a background, we previously reported that The Securities and Exchange Commission (SEC) filed fraud charges against Bennett, a Maryland-based financial services firm and founder/CEO of Bennett Group Financial Services accusing her of grossly inflating the amount of managed assets and exaggerating the investment returns actually obtained for customers.

Thereafter, on July 11, 2016, the SEC barred Bennett from the securities industry for violating federal securities rules by for making material misrepresentations and omissions regarding her assets under management. See ln the Matter of Bennett Group Financial Services, LLC & Dawn J. Bennet, File No. 3-16801.  Bennett also was ordered to cease and desist from any further violations of the federal securities rules, pay disgorgement of $556,102, and pay a civil penalty of $600,000.

FINRA continued investigating Bennett’s activities and alleged in its recent complaint that Bennett, while associated with Western International Securities, Inc., had a retail clothing business called DJBennett.com owned by DJB Holdings, LLC.  FINRA found that during 2015 Bennett sold approximately $6 million in DJB convertible notes and promissory notes guaranteed by DJBennett.com, to approximately 30 investors. FINRA also uncovered evidence that Bennett may have misappropriated investors’ money, committed fraud, and engaged in undisclosed outside business activities and private securities transactions.

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shutterstock_143685652According to the BrokerCheck records kept by Financial Industry Regulatory Authority (FINRA) broker Dawn Bennett (Bennett) has been the subject of at least six customer complaints over the course of her career. Customers have filed complaints against Bennett alleging securities law violations including that the broker made unsuitable investments, breach of fiduciary duty, negligence, misrepresentations, and excessive trading among other claims. In addition to customer complaints, The Securities and Exchange Commission (SEC) filed a press release announcing fraud charges against Bennett, a Maryland-based financial services firm and founder/CEO, accusing her of grossly inflating the amount of managed assets and exaggerating the investment returns actually obtained for customers.

Bennett entered the securities industry in 1987. From 2006, until October 2009, Bennett was associated with Royal Alliance Associates, Inc. Thereafter, from October 2009, till present Bennett is associated with Western International Securities, Inc.

The SEC’s allegations relate to Bennett’s attempts to inflate the firm’s profile and prestige by overhyping assets under management and customer returns. The SEC alleged that Bennett frequently touted to customers and on her paid radio program that highly profitable investment returns generated by Bennett Group Financial Services placed the firm in the top 1 percent of firms worldwide. However, the SEC charged that Bennett failed to disclose that the returns were calculated for a model portfolio and not based on actual investor performance. The SEC further alleged that Bennett and her firm claimed to be managing more than $2 billion in assets when in reality Bennett managed no more than one-fifth of that amount.

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