Articles Tagged with Allstate Financial Services

shutterstock_79462060-300x225According to BrokerCheck records kept by the Financial Industry Regulatory Authority (FINRA), former Newbridge Securities and Allstate broker David Faline (Faline) has been subject to three customer disputes.

A customer alleged in June 2017 that Faline made unsuitable investment recommendations that resulted in losses in the customer’ account. The customer is seeking $200,000 in the pending dispute.

In February 2014, a customer alleged Cox recommended unsuitable investments, made false and misleading statements, negligently misrepresented material facts and breached his fiduciary duty. This dispute settled for $9,000.

The number of events listed on Adcock’s BrokerCheck is high relative to her peers. According to InvestmentNews, only about 12% of financial advisors have any type of disclosure event on their records. Brokers must publicly disclose certain types of reportable events on their CRD including but not limited to customer complaints. In addition to disclosing client disputes brokers must divulge IRS tax liens, judgments, and criminal matters. However, FINRA’s records are not always complete according to a Wall Street Journal story that checked with 26 state regulators and found that at least 38,400 brokers had regulatory or financial red flags such as a personal bankruptcy that showed up in state records but not on BrokerCheck. More disturbing is the fact that 19,000 out of those 38,400 brokers had spotless BrokerCheck records.

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shutterstock_113066620The investment lawyers of Gana LLP are investigating a regulatory action brought by the Financial Industry Regulatory Authority (FINRA) against Robert Cross (Cross) (FINRA No. 2014041637201) of Rome, Georgia. Since August 2006, Cross was registered with Allstate Financial Services, LLC, where he resigned on June 28, 2013. On June 19, 2014, Allstate Financial Services filed a Form U5 amendment disclosing that a customer complaint had been filed against Respondent regarding Cross.

Thereafter, FINRA investigated Cross on the grounds that Allstate Financial Services’ Form U5 amendment stated that a customer complained of breach of contract, fraud, conversion, and negligence related to a collateralized bond obligation. FINRA’s investigation involved Cross’ outside business activities, financial reporting obligations, and whether Cross accepted unapproved loans from a customer while engaging in a private securities transaction – otherwise known in the industry as “selling away”. Thereafter, Cross refused to appear on the record to give testimony drawing an automatic bar from the financial industry.

At this time it unclear the nature and scope of Cross’ outside business activities and private securities transactions. However, according to Cross’ public records his outside business activities include Cross, Cross & Sims, Inc. and CCS Property.

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The law offices of shutterstock_183525503Gana LLP has filed an arbitration complaint before the Financial Industry Regulatory Authority (FINRA) alleging damages in excess of $3.7 million against Allstate Financial Services, LLC (Allstate) and the estate of Paul J. Godlewski (Godlewski).  The complaint alleges improper supervision and selling away related to Godlewski’s fraudulent Ponzi scheme.  Godlewski’s scheme was targeted at the retirement savings of around two dozen victims, mostly in the Pennsylvania area.  The complaint alleges that Allstate failed to properly supervise and enforce compliance measures over Godlewski, one of Allstate’s registered representatives.  The failure to supervise was alleged to cause violations of federal, state securities laws, and the financial industry’s rules and regulations.  The complaint alleged that these investors, many of whom used IRA or 401K proceeds, have lost substantially all of their investment.

“I believe there are more victims out there who are in need of help to assert their rights under the securities industry rules,” according to securities attorney Adam Gana.  As background on Godlewski, the broker was barred from the securities industry by FINRA in April 2015 after failing to respond to the regulator’s requests concerning his activities.  In June 2015, Godlewski passed away.  After Godlewski’s death many of his investors received letters from Godlewski’s estate stating that the estate was conducting a four to six months accounting on the assets and liabilities left behind by Godlewski.  Beyond these brief correspondence, investors have been left in the dark as to the status of their funds.

In the complaint, it is alleged that Godlewski created a fictional persona of a brilliant venture capital fund manager in order to sell investors.  Godlewski claimed that he created innovative trading algorithms and and managed funds with $100 million in assets under management.  To promote this persona Godlewski made appearances on television talk shows such as Money Matters purporting to be the president of Global Enterprise Investment Venture Capital a/k/a GEIVC.  GEIVC was one of the fraudulent funds that the complaint alleged Godlewski sold to claimants.  Over time Godlewski’s scheme is alleged to evolved and improved in order to better protect Godlewski from being found out.  These other more sophisticated funds include Tall Tree Note Fund I, LP (Tall Tree), another Godlewski fund, and 611 Swede Street LLC, a real estate property investment.

According to his FINRA Broker Check records, Godlewski was a broker with Allstate from March 2005 through January 2015.  The complaint alleged that at some point in or around 2008 Godlewski began his investment scheme.   Despite duties to properly supervise Godlewski, Allstate is alleged to have allowed him to sell various false securities in connection with his scheme for the rest of his tenure with the firm.  It is alleged that Godlewski used his securities license as well as an insurance salesman position with Allstate to earn the trust of his clients, solicit investors, and defraud them of over approximately $5 million in funds known to date.

Godlewski’s persona, affiliation with Allstate, and television appearance were all designed to lull investors into a false sense of security and create a credible air of legitimacy.  For instance, Godlewski provided many investors he encountered with his Allstate and Godlewski Enterprises business cards and held meetings with Godlewski at his Allstate office.  The complaint claims that Godlewski specialized in targeting IRA and 401k accounts by claiming that investors were being excessive and unnecessary fees.  Godlewski would also offer clients a 10% or 20% investment bonus for moving their funds to GEIVC or Tall Tree.  The complaint alleges that all of the Godlewski investments were made without appropriate risk disclosures.

Investors or others with knowledge of the events at Godlewski Enterprises who seek further information or want to explore their recovery rights are encouraged to contact Gana LLP.  Gana LLP has significant experience representing clients that are the victims of securities and investment fraud.  For more information about the firm and its services please visit:  Please contact Adam J. Gana, Esq., or Adam J. Weinstein, Esq., Gana LLP, 345 Seventh Avenue, 21st Floor, New York, NY, 10001, Telephone: (212) 776-4252, E-Mail:

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shutterstock_12144202The Financial Industry Regulatory Authority (FINRA) recently sanctioned and barred broker Paul Godlewski (Godlewski) concerning allegations Godlewski refused cooperate with requests made by FINRA in connection with an investigation into possible outside business activities. Such activities may, under certain circumstances also involve investment transactions referred to as “selling away” in the industry. According to FINRA BrokerCheck records Godlewski has disclosed outside business activities include Preferred Systems, Inc., PA Tags & Notary, and certain rental property real estate interests. It is unclear whether FINRA’s investigation concerns these particular outside business activities.

Godlewski entered the securities industry in 2004, when he became associated with Allstate Financial Services, LLC (Allstate). Godlewski held a Series 6 license which is for an Investment Company and Variable Contracts Products Representative. On January 12, 2015, Allstate filed a termination notice (known as a Form U5) with FINRA disclosing that Godlewski was discharged from the firm.

According to FINRA, in March 2015, the agency began investigating whether Godlewski had engaged in outside business activities and failure to follow Allstate’s procedures concerning televised public appearances. As part of its investigation, on March 12, 2015, FINRA sent a request to Godlewski for certain documents and information. According to FINRA, Godlewski stated on a call with FINRA staff on March 16, 2015, that he will not cooperate with the investigation. Consequently, Godlewski was barred by FINRA.

The conduct alleged against Godlewski may lead to “selling away” securities violations. In the industry the term selling away refers to when a financial advisor solicits investments in companies, promissory notes, or other securities that are not pre-approved by the broker’s affiliated firm. However, even though the brokerage firm claim ignorance of their advisor’s activities, under the FINRA rules, a brokerage firm owes a duty to properly monitor and supervise its employees in order to detect and prevent brokers from offering investments in this fashion. In order to properly supervise their brokers each firm is required to have procedures in order to monitor the activities of each advisor’s activities and interaction with the public. Selling away often occurs in brokerage firm that either fail to put in place a reasonable supervisory system or fail to actually implement that system. Supervisory failures allow brokers to engage in unsupervised misconduct that can include all manner improper conduct including selling away.

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The Financial Industry Regulatory Authority (FINRA) sanctioned broker Marylin T. Meyers (Myers) $20,000 and barred her for two years concerning allegations between September 2009, and February 2011, she participated in a series of private securities transactions totaling approximately $1,000,000 without notifying her firm, Allstate Financial Services, LLC (Allstate) or obtaining the firm’s written approval. FINRA alleged that Meyers recommended that five investors invest in On The Edge and she helped facilitate their purchases of On the Edge Notes.  On The Edge is a California based company formed to be a supplier of consumer goods such as tents, folding chairs, wagons, and promotional items related to retailers.  To date, On The Edge has failed to repay the principal and interest due to the investors.

Meyers first became registered with FINRA in 1986 with Merrill Lynch, Pierce, Fenncr & Smith Incorporated.  In 2001, Meyers became associated with Metlife Securities Inc.  Thereafter, in July 2004, Meyers joined Allstate until her termination on May 17, 2012.

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