Securities Lawyers Blog
The law offices of Gana Weinstein LLP are currently investigating claims that Broker Gregory Whelan (Whelan) has been accused by investors of engaging in fraudulent misappropriation of their funds. According to records kept by The Financial Industry Regulatory Authority (FINRA), it appears that Whelan was employed by Kovack Securities INC. at the time of the activity. If you have been a victim of Whelan’s alleged misconduct our firm may be able to assist you in recovering funds.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $3,408,797.00 on May 14, 2024.
The customer alleges unsuitable investments, misrepresentations, and the use of personal email to engage in selling away.
We have a strong track record of advocating for victims of fraud when advisors obtain loans from clients or engage in securities sales via OBAs. The sale of unapproved investment products, fake investments that cover misappropriated funds, and other fraudulent behavior – is a practice known in the industry as “selling away” – a serious violation of the securities laws. “Selling away” is the term used in the industry when a financial advisor solicits investments in companies, promissory notes, or securities without obtaining approval from their affiliated brokerage firm. Although certain investments may have some validity, they frequently devolve into Ponzi schemes or involve advisors unlawfully diverting 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. To adequately supervise their brokers, firms must implement systems that track advisors’ activities and communications 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.
Whelan entered the securities industry in 2007. Whelan has been registered as a Broker with Kovack Securities INC. since 2025.
Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. At Gana Weinstein LLP, our attorneys are experienced representing investors who have suffered securities losses due to the mishandling of their accounts. Claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.