Investment Lawyer

FINRA Bars Former First Allied Broker John Kai

September 26, 2017 | by Staff Attorney

The investment lawyers of Gana Weinstein LLP are investigating allegations made by The Financial Industry Regulatory Authority (FINRA) against former First Allied broker John Kai (Kai), working out of Hilo, Hawaii. According to Kai’s file on FINRA’s BrokerCheck, he was suspended in June 2017 for failing “to respond to FINRA requests for information” and was barred from the securities industry on September 12, 2017.

Kai entered the industry in 1991 and worked for Merrill Lynch, Pierce, Fenner & Smith Incorporated until 1995. He then moved to Painewebber Incorporated from 1995 until 1999. From 1999 until 2006, he was with Linsco/Private Ledger Corp. From 2006 until 2010, Kai was with Commonwealth Financial Network. And finally, he was with First Allied Securities, Inc. from 2010 until 2017 when he was terminated.

First Allied terminated John Kai in April for violating “numerous firm policies including communication with the public, undisclosed private securities transactions and outside business activity, borrowing funds from a client, and exercising discretion in clients’ brokerage accounts without the firm’s approval.”

Broker Ann Comcowich Barred by FINRA

September 20, 2017 | by Staff Attorney

The investment lawyers of Gana Weinstein LLP are investigating the allegations made by The Financial Industry Regulatory Authority against broker Ann Comcowich (Comcowich). According to the broker’s file on FINRA’s BrokerCheck, Comcowich allegedly refused to provide the proper documentation and information to FINRA that was necessary during an ongoing investigation regarding an amended Form U5 that was filed by her former firm. During her employment at Prudential, Comcowich was allegedly suspected of processing 13 unauthorized withdrawals from customer accounts. In April 2017, due to these allegations, Comcowich was barred from holding any registration capacities in FINRA.

Comcowich entered the industry in 1999 and had 16 years of experience as a registered broker. Before being barred, she was employed at Prudential Investment Management Services LLC from March 2000 to November 2016.

The term “securities fraud” covers a range of illegal activities involving the deception of investors or the manipulation of the financial markets. Fraud includes false representations, unauthorized trading, value manipulation, and Ponzi schemes. Investors are protected against fraudulent securities activities by several different civil laws.

Broker Dan Droeg Subject to Unsuitability Complaints

August 2, 2017 | by Staff Attorney

Our law firm, Gana Weinstein LLP, is investigating claims made by Financial Industry Regulatory Authority (FINRA) against broker Dan Droeg (Droeg). According to BrokerCheck, Droeg’s record contains two customer complaints filed against him regarding alleged unsuitability.

The most recent customer complaint was filed against Droeg in November 2016. During the period of July 2012 to November 2016, Droeg allegedly recommended over-concentrated and illiquid investments in variable annuities for numerous profit sharing plans. The client also claimed that the broker allegedly incorrectly reported the values and performances of the investments. The alleged damages are worth $250,067. The case is currently pending.

During January 2005, another customer complaint was filed against Droeg concerned alleged unsuitability. The broker allegedly recommended variable annuities, which were highly unsuitable for an elderly customer with low risk tolerance. The alleged damages were worth $6,000 and the case settled for $18,043.79.

Financial Advisor Gregory Pease Subject to Multiple Customer Complaints

July 31, 2017 | by Staff Attorney

The investment fraud lawyers of Gana Weinstein LLP are examining multiple customer disputes filed with the Financial Industry Regulatory Authority (FINRA) against financial advisor Gregory Pease (Pease). According to BrokerCheck, Pease has a multitude of disclosures concerning: churning, excessive trading, unauthorized trading, unsuitability, and breach of fiduciary duty.

The most recent customer complaint filed against Pease was filed in November 2016. The complaint alleged that during the period between 1998 and 2015, Pease made unsuitable recommendations, misrepresentation, and omission of material facts regarding mutual funds. The alleged damages are unspecified and the case is still pending.

Another customer complaint against Pease was filed in March 2015 and alleged that Pease misrepresented the client’s financial objectives. According the customer, the amount of trades and fees that occurred in the accounts did not properly align with the client’s desires. The alleged damages were worth $13,266.81 and the case was later settled for $10,297.88.

Lee Rosenberg Subject to Variable Annuity Complaint

July 6, 2017 | by Staff Attorney

In February 2017, broker Lee Rosenberg (Rosenberg) was subject to a customer complaint alleging $250,000 in damages concerning mutual funds and variable annuities. The complaint is currently pending. Rosenberg is currently associated with Cadaret, Grant & Co., Inc. (Cadaret Grant). The law offices of Gana Weinstein LLP are currently investigating customer complaints concerning this broker. According BrokerCheck the Rosenberg has a total of four customer complaint disclosures including allegations of unsuitable investments and unauthorized trading among other claims.

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.

However, the benefits of variable annuities are often outweighed by the terms of the contract that include exorbitant expenses such as surrender charges, mortality and expense charges, management fees, market-related risks, and rider costs.

Abraham Heimann Subject to Multiple Customer Complaints

July 3, 2017 | by Staff Attorney

Since the beginning of 2017 broker Abraham Heimann (Heimann) has subject to three customer complaints alleging millions in damages. Heimann left his last employer Cetera Advisors LLC (Cetera) in February 2016. According BrokerCheck the customer complaints allege breach of fiduciary duty, unsuitable investments, negligence, and failure to diversify the portfolio, among other claims.

The most recent complaint was filed in April 2017 and alleges breach of fiduciary duty, negligence, and failure to diversify the portfolio and claims $30,000 in damages. The claim is currently pending. In March 2017 a customer filed a complaint alleging $2,000,000 in damages due to breach of fiduciary duty and negligence. The complaint is currently pending. The securities lawyers of Gana Weinstein LLP continue to investigate the customer complaint against Heimann.

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.

Money Concepts Broker Craig Sutherland Subject to Multiple Customer Complaints

June 20, 2017 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker Craig Sutherland (Sutherland) currently associated with Money Concepts Capital Corp (Money Concepts). According to BrokerCheck records, Sutherland has been subject to seven customer complaints. The customer complaints against Sutherland allege a number of securities law violations including that the broker made unsuitable investments, breach of fiduciary duty, and negligence among other claims.

Several of the claims involve allegations of high risk investments in Tanzania Royalty Exploration, variable annuities, non-traded REITs such as American Realty Capital Healthcare, and oil and gas related investments. Variable annuities and non-traded REITs are high risk investments that brokers often sell to generate large commissions to the detriment of their clients.

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.

FINRA Bars Broker Daniel Vazquez – Accused Of Unsuitable Securities Sales

June 19, 2017 | by Staff Attorney

Broker Daniel Vazquez (Vazquez) was recently sanctioned by The Financial Industry Regulatory Authority (FINRA) in an enforcement action that resulted in a permanent bar from the securities industry. According to the FINRA AWC (Letter of Acceptance, Waiver, and Consent) FINRA found that Vazquez failed to request termination of his suspension within three months of the date of the suspension and was automatically barred from association with any FINRA member in any capacity.

The securities lawyers of Gana Weinstein LLP are investigating the six customer complaints brought against Vazquez. In addition, Vazquez has one judgment or lien. The customer complaints allege a number of securities law violations including that the broker made unsuitable investments, misrepresentations, an unauthorized trading among other claims.

The most recent claim was filed in December 2016 alleging Vazquez engaged in unsuitable trades causing $1,500,000 in damages. The complaint is currently pending. In August 2016 another investor filed a complaint alleging investment losses from trades made with Vazquez through two firms from 2013-2016 that were unsuitable. The claim alleges $107,392.85 in damages and is currently pending.

Broker Jeffrey Hill Subject to Multiple Regulatory and Customer Complaints

June 16, 2017 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer and regulatory complaints filed against broker Jeffrey Hill (Hill). According to BrokerCheck records, Hill has been subject to three regulatory actions, eight customer complaints, and one termination for cause disclosures. The most recent customer complaint against Hill alleged that between 2003 and 2014 the customer’s account was subject to churning, unauthorized trading, unsuitability and breach of fiduciary duty. The claim alleged damages of $1,600,000 and settled.

On November 22, 2016 Wells Fargo Advisors (Wells Fargo) terminated Hill based on activity alleged to have happened at his prior firm when the broker entered into an AWC with FINRA agreeing to a fifteen month suspension from the industry.

In FINRA’s complaint settled in November 2016, Hill consented to sanctions and findings that he initiated hundreds of trades for two elderly customers without contacting them and recommended or engaged in dozens of transactions that were qualitatively or quantitatively unsuitable or lacked a reasonable basis in corporate and municipal bonds. FINRA also found that neither of those customers explicitly permitted Hill to use discretion in their accounts. FINRA found that Hill would recommend that one of the customers sell bonds shortly after buying them. FINRA determined that there was no justification for the trading as neither changes in the bonds’ prices, interest that accrued, changes in the issuers’ condition, nor any other factors appeared to effect the short-term trading.

Broker Joeann Mitchell Walker Subject to Alleged Unsuitable Trades of Variable Annuities

June 6, 2017 | by Staff Attorney

Gana Weinstein LLP is investigating a customer complaint filed with the Financial Industry Regulatory Authority (FINRA) again broker Joeann Mitchell Walker (Walker). According to FINRA’s BrokerCheck records for Walker, there are several settled disclosures on her record. Walker entered the securities industry in 1992 and currently employed at Next Financial Group, Inc. She was previously employed at LPL Financial LLC (8/2006 – 4/2015), Commonwealth Financial Network (7/1998 – 8/2006), American Express Financial Advisors (6/1992 – 7/1998), and IDS Life Insurance Company (06/1992 – 7/1998).

In March 2016, a customer complaint was filed alleging Walker made unauthorized sales of different stocks, unauthorized and unsuitable purchases of variable annuities, and unauthorized mutual fund switches during the period of June 2014 to June 2015 while Walker was employed at LPL Financial LLC. The stated alleged damages were $208,764.00. The claim was settled in November 2016 for the amount of $175,000.00.

Walker has two additional previous disclosures from 2005 and 1999. In April 2005, a claim was filed alleging that Walker practiced in excessive turnovers in the client’s mutual fund account. The claim alleged damages of $30,000.00. This claim was settled in July 2005 for the final settlement amount of $9,900.00.