Securities Lawyers Blog

SagePoint Advisor Paul Mauro Subject to Multiple Investment Complaints

September 18, 2019 | by Staff Attorney

The law offices of Gana Weinstein LLP are investigating broker Paul Mauro (Mauro), currently associated with SagePoint Financial, Inc. (SagePoint Financial) out of Westborough, Massachusetts. According to a BrokerCheck report, Mauro has been subject to at least nine customer disputes, two regulatory actions, and one criminal matter during the course of his career. According to records kept by The Financial Industry Regulatory Authority (FINRA), the customer complaints against Mauro concern allegations of unsuitable investment recommendations and misrepresentations.

In February 2018, as a result of Mauro’s disclosure incidents, the State of Massachusetts Securities Division placed conditions on Mauro’s registrations in Massachusetts and required him to be placed under heightened supervision by his brokerage firm.

In December 2018 a customer alleged that in 2017 Mauro unsuitably purchased variable annuity causing $6,630 in damages. The claim was denied.

In June 2017 a customer filed a complaint alleging that Mauro made unsuitable recommendations causing $86,000 in damages. The claim was denied.

Former Morgan Stanley Advisor Ian Deliz has Numerous Complaints Over Unsuitable Puerto Rico Bond Investments

September 18, 2019 | by Staff Attorney

The law offices of Gana Weinstein LLP are currently investigating claims against advisor Ian M. Deliz Morales (Deliz), formerly registered with Morgan Stanley out of Tampa, Florida. According to a BrokerCheck report, Deliz has been subject to at least 22 customer disputes, 13 of which are still pending. In addition, Deliz disclosed a $169,324 tax lien against him. According to records kept by The Financial Industry Regulatory Authority (FINRA), the majority of these disputes concern violations of securities laws regarding unsuitable investments of Puerto Rico bonds and closed-end funds.

Most recently, in June 2019, a client alleged that Deliz violated the securities laws by recommending unsuitable investments in Puerto Rico bonds causing $315,000 in damages. This dispute is currently still pending.

In July 2017 a customer filed a complaint alleging that Deliz made unsuitable recommendations to hold Puerto Rico bonds in an over-concentrated manner. The complaint alleged $1 million in damages and was settled for $275,000.

Broker Douglas Hyer Subject to Multiple Investment Complaints

September 16, 2019 | by Staff Attorney

The law offices of Gana Weinstein LLP are investigating broker Douglas Hyer (Hyer), currently associated with First Allied Securities, Inc. (First Allied) out of Great Neck, New York. According to a BrokerCheck report, Hyer has been subject to at least four customer disputes and one termination for cause during his career. According to records kept by The Financial Industry Regulatory Authority (FINRA), the customer complaints allege that Hyer engaged in unsuitable sales of alternative investments and direct participation products (DPPs) such as non-traded real estate investment trusts (REITs), oil & gas programs, annuities, and equipment leasing programs. The attorneys at Gana Weinstein LLP have extensive experience handling investor losses caused by these types of products.

In April 2019 a customer alleged that from 2009 through 2012, Hyer recommended illiquid, risky and non-traded products that were unsuitable to the customer’s investment needs. The claim alleged over $5,000 in damages and settled for $15,000.

In February 2013 Hyer was permitted to resign from Next Financial Group, Inc. (Next Financial) after the firm found that Hyer failed to follow company policies and misused the social media.

Broker Stephen Sullivan Subject to Excessive Trading Complaint

September 16, 2019 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating broker Stephen Sullivan (Sullivan), currently associated with SW Financial out of Melville, New York. According to a BrokerCheck report, Sullivan has been subject to at least two customer disputes, one regulatory action, one financial disclosure, and three civil judgements during his career. According to records kept by The Financial Industry Regulatory Authority (FINRA), the customer complaints against Sullivan concern allegations of excessive trading also referred to as churning.

In May 2018 a customer filed a complaint against Sullivan alleging unsuitable transactions, excessive trading, and failure to supervise. The customer requested $540,618 in damages. This dispute is still pending.

In February 2016 FINRA found that Sullivan violated NASD Rules 2510(b) and 2010 by exercising discretion in customers’ accounts without obtaining authorization from the customers or approval by his member firm. Without admitting or denying the allegations, Sullivan consented to the described sanctions and to the entry of the findings. Sullivan was fined $5,000 and suspended for 10 business days.

Broker John Eads Has Several Complaints Alleging Misrepresentation of Variable Annuities

September 12, 2019 | by Staff Attorney

The securities attorneys at Gana Weinstein LLP are currently investigating advisor John Eads (Eads), formerly registered with Lion Street Financial, LLC (Lion Street Financial) and AXA Advisors, LLC (AXA Advisors) out of Titusville, Florida. According to a BrokerCheck report, Eads has been subject to at least seven customer complaints and one employment termination for cause during his career. According to records kept by The Financial Industry Regulatory Authority (FINRA), many of the complaints against Eads concern allegations of variable annuity sales practices.

In January 2018 a customer alleged Eads over forgery. In February 2018 Lion Street Financial discharged Eads claiming that he submitted client documents without their legal signatures.

In June 2016 a customer filed a complaint alleging that in March 2015 Eads recommended an unsuitable annuity causing damages. The claim settled for $85,821.

In April 2016 a customer alleged that Eads misrepresented and unsuitably recommended variable annuities causing damages. The claim was denied.

Advisor Jeffrey Nesseth Subject to Complaints Over Alternative Investments

September 12, 2019 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against Jeffrey Nesseth (Nesseth) currently associated with Independent Financial Group, LLC (Independent Financial) out of Plano, Texas. According to a BrokerCheck report, Nesseth has been subject to at least four customer disputes, two of which are still pending. Nesseth’s customer complaints mostly concern alternative investments and direct participation products (DPPs) such as non-traded real estate investment trusts (REITs), oil & gas programs, annuities, and equipment leasing programs. The attorneys at Gana Weinstein LLP have extensive experience handling investor losses caused by these types of products.

In June 2018 a customer alleged that Nesseth engaged in an over-concentration in REITs that was unsuitable to the customer’s investment needs. The customer has requested $100,000 in damages. This dispute is currently still pending.

In June 2010 a customer alleged that from December 2007 to May 2008, Nesseth made unsuitable investments of corporate debt and oil & gas causing $300,000 in damages. The claim settled for $47,500.

DDPs include products such as non-traded REITs, oil and gas offerings, equipment leasing products, and other alternative investments. These alternative investments virtually never profit investors and are almost always unsuitable for investors because of their high fee and cost structure. Brokers selling these products are paid additional commission in order to hype these inferior quality investments providing a perverse incentives to create an artificial market for products that no honest advisor would sell.

Lloyd Johnston Subject to Complaints Over Alternative Investments

September 10, 2019 | by Staff Attorney

The law offices of Gana Weinstein LLP are investigating claims against advisor Lloyd Johnston (Johnston). According to records kept by The Financial Industry Regulatory Authority (FINRA), Johnston, formerly registered with Capital Financial Services, Inc. (Capital Financial) out of Spokane, Washington was barred from the financial industry. According to a BrokerCheck report, Johnston has been subject to at least two customer complaints, four regulatory actions, two investigations, one bankruptcy disclosure, one termination, and 15 tax liens. Johnston’s customer complaints allege that Johnston engaged in unsuitable sales of alternative investments and direct participation products (DPPs) such as non-traded real estate investment trusts (REITs), oil & gas programs, annuities, and equipment leasing programs. The attorneys at Gana Weinstein LLP have handed many cases with these types of investments causing investor losses.

In September 2018 Johnston failed to disclose or timely disclose tax liens with a balance exceeding $1,000,000 and violated the terms of a Conditional Registration Order, which resulted in the revocation of his license. Large tax liens on a broker’s CRD can be a red flag that the broker may be influenced to engage in high commission activity in order to satisfy personal debts. In addition, a broker’s inability to manage their own finances is relevant in a customer’s decision to use their services.

In May 2018 Johnston failed to respond to FINRA’s request for information and was suspended indefinitely.

In May 2018 a customer alleged that Johnston’s sales of alternative investments were unsuitable to the customer’s investment needs. The exact amount of damages cannot be determined. The claim settled for $35,000.

Broker Michael Arteca Has Several Complaints Over Alternative Investments

September 10, 2019 | by Staff Attorney

The securities attorneys at Gana Weinstein LLP are investigating advisor Michael Arteca (Arteca), currently registered with Pruco Securities, LLC. (Pruco) out of Uniondale, New York. According to a BrokerCheck report, Arteca has been subject to at least five customer complaints during his career. According to records kept by The Financial Industry Regulatory Authority (FINRA), many of the complaints against Arteca concern misrepresentation in the purchase of alternative investments and direct participation products (DPPs) such as non-traded real estate investment trusts (REITs), oil & gas programs, annuities, and equipment leasing programs. The attorneys at Gana Weinstein LLP have extensive experience handling investor losses caused by these types of products.

In May 2018 a customer alleged that Arteca made misrepresentation in the purchase of multiple REITs. The customer requested $200,000 in damages. The claim settled for $50,000.

In December 2017 a customer filed a complaint alleging that Arteca misrepresented multiple life insurance and variable annuity products. The customer requested $81,000 in damages. The claim settled for $64,227.

Broker Mark Upchurch Subject to Several Investment Complaints

September 9, 2019 | by Staff Attorney

The securities attorneys at Gana Weinstein LLP are currently investigating advisor Mark Upchurch (Upchurch), currently associated with Centaurus Financial, Inc. (Centaurus Financial) out of Houston, Texas. According to a BrokerCheck report, Upchurch has been subject to at least three customer disputes, one regulatory action, and one termination for cause during his career. According to records kept by The Financial Industry Regulatory Authority (FINRA), the customer complaints against Upchurch concern allegations of unsuitable investment recommendations and misrepresentations.

In April 2018 a customer alleged that Upchurch made unsuitable investment recommendations and misrepresentations causing over $5,000 in damages. The claim settled for $17,500.

In October 2006 FINRA found that Upchurch violated NASD Rule 2110 by signing a customer’s name to an account transfer form without the customer’s permission. Without admitting or denying the allegations, Upchurch consented to the described sanctions and to the entry of the findings. Upchurch was fined $5,000 and suspended for 30 days.

Advisor Bud McLaughlin Has A Complaint and A Bankruptcy Disclosure

September 9, 2019 | by Staff Attorney

The attorneys at Gana Weinstein LLP are currently investigating advisor Bud McLaughlin Jr. (McLaughlin), currently employed by Century Securities Associates, Inc. (Century Securities) out of Chaska, Minnesota. According to a BrokerCheck report, McLaughlin has been subject to at least one customer dispute, one regulatory action, and one bankruptcy disclosure during the course of his career. According to records kept by The Financial Industry Regulatory Authority (FINRA), the customer complaint against McLaughlin alleges breach of fiduciary duty.

In February 2018 a customer filed a complaint alleging that from 2012 through 2015, McLaughlin breached his fiduciary duty and was negligent in his recommendation of an energy company causing $1,125,000 in damages. The claim was denied.

In August 2017 McLaughlin declared bankruptcy. This information has been found to be material for investors to have because an advisor who cannot manage his own finances is a relevant factor for investors to consider. In addition, a broker in financial distress may be influenced to recommend high commission products or strategies.