Articles Tagged with Western International Securities

shutterstock_27597505-300x200The securities lawyers of Gana LLP are investigating a customer complaint filed with The Financial Industry Regulatory Authority (FINRA) against broker Jed Tinder (Tinder). According to BrokerCheck records Tinder has been subject to at least four customer complaints, two judgment or liens, and two employment separations for cause. The customer complaints against Tinder alleges securities law violations that includes negligence, unauthorized trading and unsuitable recommendations among other claims.

The most recent complaint was filed in August 2016, and alleged $181,668 in damages due to claims that the broker engaged in reckless trading while employed at Western International Securities, Inc. The complaint is currently pending.

In July 2016, a customer filed a complaint against Jed Tinder alleging that while employed at Western International Securities, made an unsuitable recommendation. The customer is seeking $187,000 in damages in the pending complaint. In September 2015 another customer filed a complaint that Mr. Tinder made unsuitable recommendations dating back to 2007 causing $1,200,000 in damages. The complaint is currently pending.

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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_177577832The securities lawyers of Gana LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker Zak Shapiro (Shapiro).  According to BrokerCheck records Shapiro has been subject to at least four customer complaint, 11 financial disclosures, and 1 employment separation.  The customer complaints against Shapiro allege securities law violations that including unsuitable investments and unauthorized trading among other claims.

In February 2016 a customer filed a complaint alleging unsuitable investments and unauthorized trade occurred in or about September 2014.  The complaint has been denied.  Shapiro has disclosed 11 financial matters.  Substantial financial disputes on a broker’s record can reveal a financial incentive for the broker to recommend high commission products or services.  A broker’s inability to handle their personal finances has also been found to be relevant in helping investors determine if they should allow the broker to handle their finances.

Brokers have a responsibility treat investors fairly which includes obligations such as making only suitable investments for the client.  In order to make a suitable recommendation the broker must meet certain requirements.  Advisors are also not allowed to engage in unauthorized trading.  Such trading occurs when a broker sells securities without the prior authority from the investor. All brokers are under an obligation to first discuss trades with the investor before executing them under NYSE Rule 408(a) and FINRA Rules 2510(b).  These rules explicitly prohibit brokers from making discretionary trades in a customers’ non-discretionary accounts. The SEC has also found that unauthorized trading to be fraudulent nature because no disclosure could be more important to an investor than to be made aware that a trade will take place.

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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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shutterstock_183525503The Financial Industry Regulatory Authority (FINRA) recently barred broker Jeffrey Schrader (Schrader) concerning allegations that the broker engaged in private securities transactions and failed to cooperate with FINRA’s investigation.

Schrader entered the industry in June 1998. From November 2005, until March 2009, Schrader was associated with Merrill Lynch, Pierce, Fenner & Smith Inc. In March 2009, Schrader became associated with Western International Securities, Inc. (Western). Schrader conducts securities transactions on through his own business, Schrader Wealth Management.

FINRA found that between 2009 and 2010 Schrader, while associated with Western, engaged in over $145,000 worth of private securities transactions with three investors without providing written notice or receiving approval from Western. FINRA alleged that two of the nine investors were customers of Western at the time that their investment was made away from the firm.

The securities sold away from the firm were three-year corporate notes issued by Liberty State Benefits of Pennsylvania, Inc. (LSB). The LSB investments were purportedly secured by in-force life insurance policies owned by LSB. LSB investors were promised a 12% return rate. However, FINRA found that LSB was part of a Ponzi scheme perpetrated by the company’s senior management.

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