Reg BI

Did Your Financial Advisor Recommend Super Micro Computer? – Investor Loss Recovery

November 25, 2024 | by Staff Attorney

The attorneys at Gana Weinstein LLP are investigating claims that investors were recommended to invest substantial amounts of their savings in high risk stock Super Micro Computer, Inc. (SMCI). Investors whose advisors failed to act in their clients best interests may seek recovery before The Financial Industry Regulatory Authority (FINRA).

Super Micro Computer stock investors have been on the proverbial “wild ride” of the year. At the beginning of 2024 Super Micro Computer stock traded under $30 per share. By March of 2024 – in only 3 months – the stock was trading just shy of $120 per share and nearly a 300% gain during that time. Since March 2024 however, Super Micro Computer stock investors have watched the stock slide all the way down back to under $20 in November 2024 only to then begin to rebound.

What’s causing the wild moves? Super Micro Computer has been one of the big gainers in the artificial intelligence (AI) space and demand for its server systems has surged. Super Micro Computer’s revenues have more than doubled in 2024 and the consensus estimates see another additional 80% increase potentially. With that said, Super Micro Computer has been plagued by an accounting scandal and potential delisting from the stock exchange. Recently, Super Micro Computer hired BDO as its public auditor to replace the quitting Ernst & Young firm that resigned in October after it raised concerns regarding the company’s financial statements. With a new auditor, Super Micro Computer hopes to file two overdue financial reports including its 10-K report for the fiscal year ending June and its most recent quarterly filing for September. Super Micro Computer has also submitted a compliance plan to stay on the stock exchange. However, in August Hindenburg Research pointed to multiple red flags in the company’s accounting practices and The Wall Street Journal reported in late September that the U.S. Justice Department may be probing the company.

Advisor John Micera Has Structured Products Complaint

November 24, 2024 | by Staff Attorney

The attorneys at Gana Weinstein LLP are investigating BrokerCheck records reports that financial advisor John Micera (Micera), currently employed by RBC Capital Markets, LLC (RBC) has been subject to at least two customer complaints during the course of his career. According to records kept by The Financial Industry Regulatory Authority (FINRA), Micera’s most recent customer complaint alleges that Micera recommended unsuitable investments in structured products and makes allegations concerning misconduct relating to the handling of the customer’s accounts.

In April 2024 a customer complained that Micera violated the securities laws by alleging that Micera recommended unsuitable investments in high risk, illiquid, high commission/fee structured notes. The claim alleges $2.275 million in damages and is currently pending.

Structured products are a class of derivative products that derive their performance from market linked data. A structured product generally references a source against which market risk is taken. The source can be a single security, a basket of securities such as a market index, commodities, interest rates, or a real estate loan portfolio. The variety of products that can be structured demonstrates the difficulty in formulating a single unified definition of a structured product.

UBS Advisor Barry Schwartz Has Customer Complaint

November 11, 2024 | by Staff Attorney

According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) broker Barry Schwartz (Schwartz), currently associated with UBS Financial Services Inc. (UBS), has been subject to at least two customer complaints and one regulatory action during his career. The most recent complaint against Schwartz alleged that Schwartz recommended unsuitable investments in various equity and alternative investments among other allegations of misconduct relating to the handling of their accounts.

In December 2023 a customer complained that Schwartz, from January 2021 to February 2022, engaged in unsuitability and overconcentration of certain investments, and that such investments resulted in principal losses. The investor also alleges misrepresentation with respect to the handling of Claimants’ investment accounts and violated the securities laws claiming $1 million in damages. The claim is currently pending.

Brokers are required to adhere to the SEC’s Regulation Best Interest (Reg BI) standard of care under the Securities Exchange Act of 1934 which establishes a “best interest” standard for broker-dealers and associated persons. This standard applies when brokers make recommendations to retail customer for any securities transaction or investment strategy involving securities, including recommendations of types of accounts. Reg BI is drawn from fiduciary principles that include an obligation to act in the retail investor’s best interest and the broker is prohibited from placing their own interests ahead of the investor’s interest.