Articles Posted in Selling Away

shutterstock_189276023-300x198According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Dennis McMurray (McMurray), in August 2017, was terminated by his firm, Girard Securities, Inc. (Girard Securities) based on allegations that McMurray violated the firm’s policy on selling away and private securities transactions.  The firm also alleged that McMurray used a non-approved email address.  In addition, McMurray was barred from the industry by FINRA after FINRA requested documents and information related to an investigation into the circumstances surrounding his termination from Girard and McMurray refused to provide documents.

At this time it is unclear the extent and scope of McMurray’s private securities activities.  McMurray’s CRD lists that he is engaged in several outside business activities including 2 Truths – a mobile application development company, and is a part owner of Veritas IQ – a marketing, networking and personal development company.  At this time it is unclear whether or not McMurray’s private securities activities involve these entities or one that is not listed.

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_20354398-300x200According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Anthony Vultaggio, Jr. (Vultaggio), in September 2017, was accused by FINRA of failing to cooperate in an investigation into the circumstances surrounding Vultaggio alleged sale of undisclosed securities through an undisclosed outside business.  Vultaggio is formerly associated with American Capital Partners, LLC (American Capital).  According to the FINRA action, Vultaggio was barred by the regulator after the broker failed to respond to requests for documents and information during the investigation.

At this time the extent of Vultaggio’s outside business activities and securities sales are unknown.  The only public disclosure on Vultaggio’s BrokerCheck contains is Vultaggio’s investments in commercial and residential real estate.

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_113632177-300x249According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Christopher Parr (Parr), in October 2017, was under investigation by FINRA based on a preliminary determination that Parr’s conduct allegedly violated FINRA Rules 3240, 3280, and 2010.  In addition, the state of Kansas has a pending regulatory mater concerning allegations that Parr borrowed money from a client on three occasions and did not disclose the loans to his firm.  These allegations concern conduct that occurred while Parr was registered with KCD Financial, Inc. (KCD Financial).

At this time it is unclear the extent and scope of Parr’s activities.  Parr’s CRD lists that he does business under the name First Capital Group, Inc.

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_54385804-300x200According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Christopher Wendel (Wendel), in September 2017, was terminated by his firm, SA Stone Wealth Management Inc. (SA Stone Wealth) based on allegations that Wendel violated the firm’s policy on selling away.  In addition, Wendel has five customer complaints on his record.  The latest customer complaint occurred in May 2013 and alleged that the customer was sold in unsuitable REITs.  The claim alleged $171,000 in damages and was settled.

At this time it is unclear the extent and scope of Wendel’s private securities activities.  Wendel’s CRD lists that he is engaged in an outside business activity called Smoke on the Water LLC.

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_160071281-300x168According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Scott Newsholme (Newsholme), in September 2017, was accused by the Securities and Exchange Commission (SEC) of stealing more than $1 million from his clients.  Newsholme’s problems began back in July 2014 when he was terminated by his then employer SII Investments, Inc. (SII).  SII stated that Newsholme was terminated due to allegations that Newsholme stole her IRA assets and engaged in private securities transactions.

In addition to being an investment advisor, Newsholme is a tax preparer, accountant, and the proprietor of MVP Financial LLC in Howell, New Jersey.   Between 2002 and 2010 Newsholme was president of two predecessor tax, accounting, and financial planning firms in Matawan, New Jersey – Newley Financial Group, Inc. and Newsholme Financial Center LLC.

In September 2014, FINRA brought an action against Newsholme and ultimately barred him from the industry when Newsholme failed to respond to information requests concerning the issues raised in his SII termination.  In June 2015, the State of New Jersey revoked Newsholme’s securities license and imposed an $85,000 fine stating that Newsholme egage in unethical business practices.

Finally, in September 2017 the SEC brought action against Newsholme alleging that the broker stole more than $1 million from clients to support his gambling habit and other personal expenditures.  The SEC alleged that Newsholme concealed his fraud by making various misrepresentations to his clients, including falsely reassuring them that their investments were faring well.  Newsholme is then alleged to have fabricated account statements, doctored stock certificates, and forged promissory notes and other debt instruments as part of a scheme to convince clients to give him their money.  All the while Newsholme diverted his clients’ investment funds for his own use and cashed their investment checks at a check cashing store for himself.

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shutterstock_189302963-300x194According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor William Glaser (Glaser), in September 2017, was accused by FINRA of failing to cooperate in an investigation into the circumstances surrounding Glaser’s termination by National Panning Corporation (National Planning).  National Planning terminated Glaser in June 2017 after alleging it had received an arbitration claim alleging that Glaser had solicited a private investment away from the firm.  Glaser operated his securities business through a dba called Legacy Wealth Advisors, Inc.

The private investments Glaser was participating appear to be connected to the arrest of Paul Creager (Creager) in August 2017.   Creager has been indicted on two felony counts of wire fraud.  According to the indictment Creager financed his development company through promissory notes and by selling interests in his companies to investors.  The indictment claims that Creager misled investors by failing to disclose that Financial & Marketing Solutions LLC had lent him more than $3.2 million and had a priority secured position in his real estate developments.  It appears that some of the investors were brought to Creager through Glaser.

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_155271245-300x300According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Bruce Barber (Barber), in September 2017, was accused by FINRA of engaging in an undisclosed outside business activity by serving as an advisor to the Board of Directors for ABC, LLC (ABC) and being compensated by the company with warrants.  According to FINRA, Barber solicited 15 clients to invest in ABC’s private securities offering.  At this time it unknown the full extent and scope of Barber’s outside business activities.

In February 2017, Barber’s then employer Securities America, Inc. (Securities America) terminated him stating Barber solicited customers to purchase an unapproved securities product and participated in an unapproved outside business activity.

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_189322280-300x234According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Patrick Hudson (Hudson), in June 2015, was terminated by his then employer RBC Capital Markets (RBC).  RBC stated that Hudson was terminated due to undisclosed outside business activities and the sale of unapproved products.

Thereafter, in August 2017, FINRA brought action against Hudson finding that Hudson participated in private securities transactions in the form of promissory notes, without providing written notice or seeking written from RBC. FINRA found that Hudson’s outside real estate business entered into a series of promissory notes away from the firm totaling $490,000. In addition, Hudson participated in multiple outside businesses without providing prior written notice to the firm.  FINRA determined that on at least 21 occasions Hudson sent letters on firm letterhead to various third-parties for the purpose of verifying the assets of firm customers but that Hudson failed to submit these letters to the firm’s operations support department for supervisory review.

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_143179897-300x300According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Clark Gardner (Gardner), in May 2014, was terminated by his then employer Cetera Advisors LLC (Cetera) subsequent to the initiation of customer arbitration claim alleging unsuitable investments.  Cetera stated that Gardner was terminated due to undisclosed outside business activities and the sale of unapproved products.

Shortly thereafter on May 29, 2015, Gardner was arrested for converting approximately $1.3 million in client funds by selling promissory notes to clients and depositing the funds into his personal bank account.  This activity is alleged to have occurred from November 2011 to April 2014.  Allegedly, Gardner used the money for luxury vacation packages, repaying personal funds owed to other individuals, and other items unrelated to the promised investments.

In addition, The Division of Securities for Utah’s Department of Commerce investigated Gardner after receiving a complaint from an investor.  During that investigation the department discovered a $150,000 property purchase Gardner completed with an unregistered real estate company that earned him $20,000 in compensation.  Gardner is reported to have promised the investor a steady income from the property and a significant return in five years.

However, these incidents are not the complete history of Gardner’s prior dealings.  FINRA brought action against Gardner in 2005 for “distributing copies of a brochure promoting an insurance policy that communicated false or misleading information.”

Charging documents state Gardner also was involved in a lawsuit in Pennsylvania for advising clients to “purchase life insurance policies while misrepresenting the nature and benefits of the policies.”

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shutterstock_187532303-300x200According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Adam Veron (Veron), in February 2017, was terminated by his then employer Questar Capital Corporation (Questar).  Questar stated that Veron was terminated due to undisclosed outside business activities and the sale of unapproved products.

Thereafter, in August 2017, FINRA brought action against Veron barring him from the industry.  FINRA alleged that in July 2015, Veron formed Contract Funding and Corporate Management, LLC (CFCM) and served as its President.  CFCM allegedly provides a line of credit to a company which uses the funds to fulfill its federal procurement contracts and then pays profits to CFCM. FINRA found that Veron sold approximately $1.8 million worth of shares in CFCM.  FINRA found that Veron participated in CFCM by soliciting the investors, hiring legal counsel to draft the Subscription Agreement and Private Offering Memorandum, accepting investments by check, depositing those checks into a bank account that he controlled, providing the investors with the Offering Documents, distributing profits from CFCM, managing CFCM’s relationship with the company, and deciding who could invest in CFCM.

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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