Securities Lawyers Blog
The law offices of Gana Weinstein LLP are currently investigating claims that advisor Michael Carter (Carter) was discharged by his employer after being accused of misappropriating client funds. According to BrokerCheck records, Carter is formerly registered with The Financial Industry Regulatory Authority (FINRA) member firm Morgan Stanley. In addition, Carter disclosed three customer complaints related to misappropriating funds. If you have been a victim of Carter’s alleged misconduct our firm may be able to assist you in recovering funds.
In July 2019 Morgan Stanley discharged Carter after alleging that he was terminated after allegations of misappropriation of funds occurred.
In September 2019 FINRA filed a regulatory action alleging that Carter consented to the sanction and findings that he failed to provide documents and information requested by FINRA during the course of an investigation after FINRA received a tip relating to allegations of misconduct made by Morgan Stanley.
Our law firm has significant experience bringing cases on behalf of defrauded victims when their advisors engage in receiving loans from clients or selling fraudulent securities sales through OBAs. The sale of unapproved investment products – is a practice known in the industry as “selling away” – a serious violation of the securities laws. In the industry the term selling away refers to when a financial advisor solicits investments in companies, promissory notes, or other securities that are not pre-approved by the broker’s affiliated firm. Sometimes those investments have some legitimacy but often times these types of investments can end up being Ponzi schemes or the advisor can be engaging in the conversion of funds.
When advisors convert or misappropriate funds they often create businesses or other vehicles to serve as a cover for the theft of funds. However, federal securities laws and the FINRA rules require firms to monitor and supervise its employees in order to detect and prevent brokers from offering investments in this fashion. In order to properly supervise their brokers each firm is required to have procedures in order to monitor the activities of each advisor’s activities and interaction with the public. Selling away misconduct often occurs where brokerage firms either fail to put in place a reasonable supervisory system or fail to actually implement that system. Supervisory failures allow brokers to engage in unsupervised misconduct that can include all manner improper conduct including selling away.
In cases of selling away the investor is unaware that the advisor’s investments are improper. In many of these cases the investor will not learn that the broker’s activities were wrongful until after the investment scheme is publicized, the broker is fired or charged by law enforcement, or stops returning client calls altogether.
Carter entered the securities industry in 1999. From December 2011 until August 2019 Carter was registered with Morgan Stanley out of the firm’s McLean, Virginia office location.
Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. Investors may be able recover their losses through securities arbitration. The attorneys at Gana Weinstein LLP are experienced in representing investors in cases of selling away and brokerage firms failure to supervise their representatives. Our consultations are free of charge and the firm is only compensated if you recover.