Articles Posted in Securities Lawyer

shutterstock_19864066-209x300According to BrokerCheck records financial advisor Joseph Rodriguez (Rodriguez), currently associated with Hennion & Walsh, Inc. (Hennion & Walsh), has been subject to four customer complaints.  According to records kept by The Financial Industry Regulatory Authority (FINRA) Rodriguez has been accused by customers of unsuitable investments among other claims.  Most of the claims appear to be related to municipal bonds or other bond related investments

In June 2017, a customer filed a complaint alleging that Rodriguez recommended certain investment grade municipal bonds between 2009 and 2012 that were unsuitable.  The claim alleges $125,000 in damages and is currently pending.  In May 2016 another customer filed a complaint alleging that there were unsuitable recommendations from 2013 and 2014.  The claim alleged $250,000 in damages and settled.  In October 2015 another customer filed a complaint alleging an unsuitable recommendation causing $56,390 in damages.  The claim later settled.

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shutterstock_78659098-300x225According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Jonathan Freeze (Freeze), in August 2017, was accused by FINRA of failing to cooperate in an investigation into the circumstances surrounding Freeze’s alleged sale of variable annuities.  Freeze is formerly associated with Fortune Financial Services, Inc. (Fortune Financial).  According to the FINRA action, Freeze was barred by the regulator after the broker failed to respond to requests for documents and information during the investigation.

In 2015, Feeze was also sanctioned by FINRA concerning allegations that he borrowed $20,000 from his customer and failed to provide the firm with prior notice of the loan and failed to obtain prior written pre-approval for the loan.  Freeze has also been subject to two terminations for cause and multiple financial disclosures.

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.

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shutterstock_20354398-300x200According to BrokerCheck records financial advisor Herbert Smith (Smith), currently associated with Kestra Investment Services, LLC (Ketra Investment), has been subject to one customer complaint and two tax liens.  According to records kept by The Financial Industry Regulatory Authority (FINRA) Smith has been accused by a customers of unsuitable investment advice concerning energy limited partnership investment among other claims.  The law offices of Gana LLP continue to report on investor related losses and potential legal remedies due to recommendations to investor in oil and gas and commodities related investments.

In addition, Smith has been subject to two tax liens.  The first in May 2014 for $65,692 and the second in July 2016 for $69,542.  Tax liens can be sign that a broker may have a conflict of interest to recommend or engage in high risk trades and improper recommendations due to the need to obtain funds.  FINRA discloses tax liens information because it is important for investors to know whether or not a broker can manage their own finances.

Our firm is investigating potential securities claims against brokerage firms over sales practices related to the recommendations of oil & gas and commodities products such as exchange traded notes (ETNs), structured notes, private placements, master limited partnerships (MLPs), leveraged ETFs, mutual funds, and individual stocks.

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shutterstock_1832893-226x300The law offices of Gana LLP continue to report on investor related losses and potential legal remedies due to recommendations to investor in oil and gas and commodities related investments.  According to BrokerCheck records, Customers have filed about seven complaints with the Financial Industry Regulatory Authority’s (FINRA) against broker Jeffrey Grayson (Grayson), a former registered representative with Wells Fargo Advisors (Wells Fargo) out of the firm’s Florham Park, New Jersey office location.

Some of the customer complaints against Grayson allege a number of securities law violations including that the broker made unsuitable investments and overcenoncetrated clients in oil & gas related investments among other claims.  The most recent complaint was filed in June 2017 and alleged unauthorized trading and unsuitable investments.  The complaint is currently pending.

In February 2017 FINRA suspended Grayson alleging that Grayson exercised discretion in four accounts without written authorization from those customers and without having obtained approval from his member firm to treat those customer accounts as discretionary. FINRA also found that Grayson provided inaccurate responses about his use of discretion on the firm’s annual compliance documents.

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shutterstock_138129767-300x199According to BrokerCheck records Brian Murphy (Murphy) has been sanctioned and barred by The Financial Industry Regulatory Authority (FINRA) over allegations that the broker failed to respond to the regulator’s requests for information.  In July 2016, Murphy was terminated by his firm Signator Investors, Inc. (Signator) on allegations that Murphy admitted to conducting an unapproved outside business activity.  In the industry all such activities must be disclosed and approved by the firm before the broker can engage in them.

Murphy has been terminated by three employers in total during his career.  In November 2014 Murphy was terminated by MetLife Securities, Inc. (MetLife) for making a representation that he had a professional designation that he did not in fact possess.  In addition, Murphy has been subject to a number of customer complaints concerning the sale of variable annuities.

At this time it is unclear what outside business activity Murphy was engaged in.  However, the risk to investors is that the broker will use such businesses to engage in unauthorized securities activities.  The providing of loans or selling of notes and other investments outside of a brokerage firm constitutes impermissible private securities transactions – a practice known in the industry as “selling away”.

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shutterstock_95643673-300x300Since the beginning of 2010 broker John Hudson (Hudson), currently employed by Next Financial Group, Inc. (Next Financial), racked up eight total tax liens and other debts.  Some of these tax liens are quite large including on in September 2010 for $1,492,190.  According to BrokerCheck this tax lien is still active and hasn’t been satisfied.  While no customer complaints have been filed against Hudson and the presence of large liens does not necessarily mean that the broker will engage in risky behavior it is an important red flag for investors to consider.  The risk is that the broker will be influenced to recommend high commission products or trading strategies to satisfy the liens at investors’ expense.  In extreme cases brokers have even misappropriated funds or asked clients for loans to satisfy their personal debts.  There is no indication that any wrongdoing has occurred in Hudson’s case.

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shutterstock_178565714-300x200Gana LLP is investigating new customer complaints filed with the Financial Industry Regulatory Authority (FINRA) against broker Aaron Robert Parthemer (Parthemer). Our firm has been investigating Parthemer since 2015, when Parthemer was barred from FINRA for engaging in private securities transactions, also known as “selling away”. According to FINRA’s BrokerCheck records for Parthemer, there are 4 new disclosures on his record since his last regulatory action in 2015. These disclosures including customer complaints against Parthemer alleging unsuitable and unauthorized investments, and misrepresentation. Parthemer was barred permanently from FINRA on April 2015. His registration to the New Jersey Bureau of Securities, a self-regulatory organization, was revoke in September 2015.

The most current customer complaint pending against Parthemer is from May 2017, alleging Parthemer made unsuitable investments starting in 2009 when Parthemer was employed at Wells Fargo Advisors and Morgan Stanley Smith Barney. During Parthemer’s stint at Morgan Stanley, the client alleged that Parthemer presented outside investment opportunities that he had a personal interest in, which was unauthorized by the firm. The customer alleged damages of $1,622,844.00.

A second customer complaint was submitted in September 2016 regarding Parthemer’s actions while employed at Morgan Stanley Smith Barney. The customer alleged that Parthemer solicited the client to invest in outside investments that were not authorized by Morgan Stanley. The alleged damages are $205,000.00 and is still pending.

shutterstock_145368937-300x225The securities and investment fraud attorneys at Gana LLP are investigating the regulatory complaint filed by The Financial Industry Regulatory Authority (FINRA) against broker Stanley Clayton Niekras (Niekras). The FINRA regulatory action alleges that Niekras recommended unsuitable variable annuity exchanges in three customers’ accounts. FINRA found that Niekras effected the annuity exchanges to benefit himself at the customers’ expense. Niekras allegedly misrepresented himself to a couple in their 90s claiming $70,000 of fees due for financial planning services. According to BrokerCheck records, Niekras has been subject to eight customer complaints and one regulatory action among other claims.

The FINRA complaint alleges that Niekras made fraudulent misrepresentations to an elderly couple in their 90s to collect more than $70,000 in estate and financial planning fees while associated with the brokerage firm MML Investors Services, LLC. FINRA alleges that Niekras didn’t have an investment advisory or financial planning agreement with the elderly couple, but he billed them for hundreds of hours of time that he supposedly spent working on their “financial future”, work that he claimed to have done over four years knowing he wasn’t entitled to the “estate planning” or “financial planning” fees he charged. In February 2013, he recommended that the children buy a particular variable annuity with the gifted assets, anticipating collecting about $75,000 in commissions from the sales. The claim is currently pending.

The most recent complaint was filed in December 2010 alleging unsuitable variable annuity recommendations in clients account from January 1995 through March 2005 causing over $5,000 in damages. The claim settled for $247,500.00.

shutterstock_152933045-300x200The securities lawyers of Gana LLP are investigating a customer complaint filed with The Financial Industry Regulatory Authority (FINRA) against broker Albert Dishner (Dishner), currently associated with Morgan Stanley. According to BrokerCheck records Dishner has been subject to at least four customer complaints among other claims. The customer complaints against Dishner allege securities law violations that including unsuitable investments, unauthorized trading, churning (excessive trading), and breach of fiduciary duty trading among other claims.

The most recent complaint against Dishner was filed in August 2016, while employed at Credit Suisse Securities, alleging $600,000.00 in damage stemming from violation of FINRA rules and federal securities laws, churning, and trading negligently in customer’s account from 2010 until 2015. The complaint settled in December 2016 for $205,000.00.

In 2012 a customer filed a complaint alleging, while employed at Credit Suisse Securities, Dishner did not follow customers instructions to sell securities and later executed an unauthorized sale causing $354,000 in damages. The complaint was denied.

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