According to the BrokerCheck records kept by Financial Industry Regulatory Authority (FINRA) broker Michael Bell (Bell) has been the subject of at least 8 customer complaints, two financial disclosures, two firm terminations, and two regulatory actions. Customers have filed complaints against Bell alleging a litany of securities law violations including that the broker made unsuitable investments, unauthorized trades, breach of fiduciary duty, misrepresentations and false statements, churning, and fraud, among other claims. Some of these claims involve recommendations in penny stocks, private placements, and other speculative securities.
An examination of Bell’s employment history reveals that Bell moves from troubled firm to troubled firm. The pattern of brokers moving in this way is sometimes called “cockroaching” within the industry. See More Than 5,000 Stockbrokers From Expelled Firms Still Selling Securities, The Wall Street Journal, (Oct. 4, 2013). In Bell’s 25 year career he has worked at 18 different firms.
Since 2008 Bell has been registered with Brewer Financial Services, LLC, Herbert J. Sims & Co. Inc., and most recently Westpark Capital, Inc. (Westpark) until July 2014.
In Bell’s most recent regulatory action, FINRA alleged that Bell used his personal email address to communicate with current and prospective customers by sending about 20 emails from this personal email account. The communications related to customers’ investments at Westpark and were also used to solicit existing and potential customers to make new investments. According to FINRA, Bell had been previously disciplined by Westpark for the misuse of e-mail and that Bell knew that use of personal email was unauthorized.
FINRA also alleged that Bell sent six emails to two prospective customers concerning a private placement investment referred to by the initials “MD.” FINRA found that Bells’s representations were unbalanced, misleading, promissory, and projected performance that lacked a reasonable basis. One such emails stated that “ipo price must be at least $3 per share…assuming stock simply holds the price for 6 months, a $50 thou[sand] investment is worth $116,664…of course nothing is a guarantee, but we expect stock to trade higher since company is expanding so rapidly…expecting over $80 million this year revenue.”
The number of complaints and regulatory actions against Bell is relatively large by industry standards. According to InvestmentNews, only about 12% of financial advisors have any type of disclosure event on their records. Brokers must disclose different types of events, not necessarily all of which are customer complaints. These disclosures can include IRS tax liens, judgments, and even criminal matters.
Investors who have suffered losses may be able recover their losses through securities arbitration. The attorneys at Gana LLP are experienced in representing investors in cases where their broker has acted inappropriately. Our consultations are free of charge and the firm is only compensated if you recover.