Investment Lawyer

Woodstock Financial Group Broker John Tinnelly Subject to Churning Complaints

September 13, 2016 | by Staff Attorney

The securities fraud lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker John Tinnelly (Tinnelly). According to BrokerCheck records Tinnelly has been the subject of at least ten customer complaints and one regulatory action. The customer complaints against Tinnelly allege a number of securities law violations including that the broker made unsuitable investments, unauthorized trading, and churning (excessive trading) among other claims.

The most recent complaint was filed in April 2015 and alleged churning, unsuitable investments, unauthorized trading, breach of contract from July 2010 until November 2012 causing $168,924 in damages. The complaint settled with no contribution by the broker. In March 2015, another customer complaint alleged churning, unsuitable investments, unauthorized trading, breach of contract from February 2010 until March 2011 causing $118,375 in damages. The complaint is currently pending.

When brokers engage in excessive trading, sometimes referred to as churning, the broker will typical trade in and out of securities, sometimes even the same stock, many times over a short period of time. Often times the account will completely “turnover” every month with different securities. This type of investment trading activity in the client’s account serves no reasonable purpose for the investor and is engaged in only to profit the broker through the generation of commissions created by the trades. Churning is considered a species of securities fraud. The elements of the claim are excessive transactions of securities, broker control over the account, and intent to defraud the investor by obtaining unlawful commissions. A similar claim, excessive trading, under FINRA’s suitability rule involves just the first two elements. Certain commonly used measures and ratios used to determine churning help evaluate a churning claim. These ratios look at how frequently the account is turned over plus whether or not the expenses incurred in the account made it unreasonable that the investor could reasonably profit from the activity.

James Noto’s Variable Annuity Sales Practices Lead to Customer Disputes

September 6, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker James Noto (Noto). According to BrokerCheck records Noto is subject to at least one regulatory sanction and seven customer complaints. The customer complaints against Noto allege securities law violations that claim unsuitable investments and lack of due diligence among other claims. Many of the more recent claims involve the sale of Variable Annuity products.

The most recent complaint was filed in March 2016, and alleged that James Noto, while employed at Summit Brokerage Services (Summit), recommended an unsuitable investment in a variable annuity. In 2015, another customer filed a complaint alleging that Noto made unsuitable investment recommendations.

Variable annuities are complex financial and insurance products. In fact, recently the Securities and Exchange Commission (SEC) released a publication entitled: Variable Annuities: What You Should Know encouraging investors to ask questions about the variable annuity before investing. Essentially, a variable annuity is a contract with an insurance company under which the insurer agrees to make periodic payments to you. The investor chooses the investments made in the annuity and value of your variable annuity will vary depending on the performance of the investment options chosen. The primary benefits of variable annuities are the death benefit and tax deferment of investment gains.

Customers File Complaints Against Broker Charles Correal Over Unsuitable Oil and Gas Investments

May 21, 2016 | by Staff Attorney

The investment attorneys of Gana Weinstein LLP are investigating investor claims of unsuitable investments in oil and gas related products. Our firm is currently representing a number of investors who lost substantial savings due to poor advice to concentrate holdings in speculative commodities investments like master limited partnerships (MLPs). According to Brokercheck records, Charles Correal (Correal) formerly with Morgan Stanley operating from their offices in Upper St. Clair, Pennsylvania has recently received at least several customer complaints with similar allegations that the broker overconcentrated them in oil and gas related investments.

One of the most popular energy related investments that have become increasingly popular in the brokerage industry in recent years are MLPs. MLPs are publicly traded partnerships. About 86% of the total MLP securities market, a $490 billion sector, can be attributed to energy and natural resource companies. There are about 130 MLPs trading on major exchanges that focus on energy related industries and natural resources.

Wall Street loves MLPs because they provide high yields to investors and require companies to pay Wall Street in order to continue to grow. In 2013 banks earned fees of $890.3 million from MLP issuance. Bloomberg quoted an analyst stating that “MLPs are Wall Street’s dream,” because “[t]hey’re fee machines.” Naturally, in order to entice investors to continue to invest in MLPs Wall Street pumps up MLPs every chance they get. According to Bloomberg, in May 2014 “[a]nalysts predict that 93 of the 114 MLPs in existence will rise in value in the next year…” Astonishingly, “all but five MLPs are recommended by the majority of the analysts who cover them.” At that time professionals without conflicts called MLPs “the next great investment debacle” and warned that “many MLP shareholders…may not understand what they’ve gotten into.”

Customers File Complaints Against VSR Financial Broker Dennis Van Patter

May 19, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker Dennis Van Patter (Van Patter). According to BrokerCheck records Van Patter has been subject to at least eight customer complaints and one regulatory action. The customer complaints against Van Patter allege securities law violations that including unsuitable investments, misrepresentations, and breach of fiduciary duty among other claims. Many of the complaints involve direct participation products (DPPs) and private placements including oil and gas partnerships, non-traded real estate investment trusts (REITs), and other alternative investments. In a FINRA regulatory action Van Patter was found to have onverconcentrated an investor in alternative investments.

Our firm has represented many clients in these types of products. All of these investments come with high costs and historically have underperformed even safe benchmarks, like U.S. treasury bonds. For example, products like oil and gas partnerships, REITs, and other alternative investments are only appropriate for a narrow band of investors under certain conditions due to the high costs, illiquidity, and huge redemption charges of the products, if they can be redeemed. However, due to the high commissions brokers earn on these products they sell them to investors who cannot profit from them. Further, investor often fail to understand that they have lost money until many years after agreeing to the investment. In sum, for all of their costs and risks, investors in these programs are in no way additionally compensated for the loss of liquidity, risks, or cost.

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. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.

Customers File Complaints Against Woodbury Financial Broker Daniel Dunn

May 19, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker Daniel Dunn (Dunn). According to BrokerCheck records Dunn has been subject to at least five customer complaints. The customer complaints against Dunn allege securities law violations that including unsuitable investments, and misrepresentations among other claims. Many of the complaints involve direct participation products (DPPs) and private placements including ICON Leasing, variable annuities, and tenant-in-common trusts (TICs).

Our firm has represented many clients in these types of products. All of these investments come with high costs and historically have underperformed even safe benchmarks, like U.S. treasury bonds. For example, products like variable annuities, ICON, and other DPPs are only appropriate for a narrow band of investors under certain conditions due to the high costs, illiquidity, and huge redemption charges of the products, if they can be redeemed. However, due to the high commissions brokers earn on these products they sell them to investors who cannot profit from them. Further, investor often fail to understand that they have lost money until many years after agreeing to the investment. In sum, for all of their costs and risks, investors in these programs are in no way additionally compensated for the loss of liquidity, risks, or cost.

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. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.

Gana LLP Investigates Customer Complaints Against H. Beck Broker Scott Goldman

May 17, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker Scott Goldman (Goldman). According to BrokerCheck records Goldman has been subject to at least six customer complaints. The customer complaints against Goldman allege securities law violations that including unsuitable investments, misrepresentations, failure to supervise, and breach of fiduciary duty among other claims. Some of the claims involve variable annuity and variable universal life insurance products.

Our firm has represented many clients in these types of products. All of these investments come with high costs and historically have underperformed even safe benchmarks, like U.S. treasury bonds. For example, products like variable annuities are only appropriate for a narrow band of investors under certain conditions due to the high costs, illiquidity, and huge redemption charges of the products. However, due to the high commissions brokers earn on these products they sell them to investors who cannot profit from them. Further, investor often fail to understand that they have lost money until many years after agreeing to the investment. In sum, for all of their costs and risks, investors in these programs are in no way additionally compensated for the loss of liquidity, risks, or cost.

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. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.

Gana LLP Investigates Regulatory and Customer Complaints Against Broker James Ignatowich

May 16, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker James Ignatowich (Ignatowich). According to BrokerCheck records Ignatowich has been subject to at least nine customer complaints and one regulatory action. The customer complaints against Ignatowich allege securities law violations that including unsuitable investments and unauthorized trading among other claims. In addition, the state of New Hampshire filed a complaint against Ignatowich alleging that the broker engaged in unlawful telemarketing and provided inaccurate and misleading information to the state during the course of their investigation. Ignatowich was sanctioned $87,500 and barred for nine months.

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. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.

The number of events listed on Ignatowich brokercheck is high relative to her peers. According to InvestmentNews, only about 12% of financial advisors have any type of disclosure event on their records. Brokers must publicly disclose certain types of reportable events on their CRD including but not limited to customer complaints. In addition to disclosing client disputes brokers must divulge IRS tax liens, judgments, and criminal matters. However, FINRA’s records are not always complete according to a Wall Street Journal story that checked with 26 state regulators and found that at least 38,400 brokers had regulatory or financial red flags such as a personal bankruptcy that showed up in state records but not on BrokerCheck. More disturbing is the fact that 19,000 out of those 38,400 brokers had spotless BrokerCheck records.

Broker Investigation: Customer Complaints Against Advisor William Baumner

April 11, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker William Baumner (Baumner). According to BrokerCheck records Baumner has been subject to at least seven customer complaints and five judgements or liens. The customer complaints against Baumner allege securities law violations that including unsuitable investments, breach of fiduciary duty, and misrepresentations among other claims. According to the disclosures, many of the complaints involve private companies, private placements, penny stocks, and one complaint mentions a recommendation for CTX Virtual.

In December 2015 a customer filed a complaint alleging $100,000 in damage stemming from misrepresentations for a stock between February 2014 and January 2016. The complaint has been denied. Baumner has disclosed several large tax liens including a $5,825 lien in January 2015. Substantial judgements and liens 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. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.

Broker Investigation: Ameriprise Financial Broker William Utanski

April 4, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker William Utanski (Utanski). According to BrokerCheck records Utanski is subject to three customer complaints. The customer complaints against Utanski allege securities law violations that including unsuitable investments and churning (excessive trading) among other claims. The claims appear to largely relate to allegations regarding the inappropriate sale of Dendreon Corporation stock.

One claim that was filed in October 2015 claimed that Utanski made unsuitable investment recommendations in 2011, that included closed-end funds and Dendreon stock. The customer also allege Utanski churned their account suffered compensatory damages of $200,000. The claim is currently pending.

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. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.

Broker Investigation: Customer Complaints Against VSR Financial Broker Jesse Griffin

March 28, 2016 | by Staff Attorney

The securities fraud lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker Jesse Griffin (Griffin). According to BrokerCheck records Griffin has been the subject of at least six customer complaints three of which have been filed since 2014. The customer complaints against Griffin allege a number of securities law violations including that the broker made unsuitable investments, fraud, breach of fiduciary duty, and negligence among other claims.

The most recent customer complaint filed in June 2015 alleged unsuitable investments from November 2006 through September 2008. The claim was settled.

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. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.