Articles Tagged with IFS Securities

shutterstock_113632177-300x249According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Robert Jamison (Jamison), formerly associated with PNC Investments, in December 2018, was sanctioned and barred from the securities industry by FINRA over accusations of potentially selling unapproved products.

In December 2018 FINRA alleged that Jamison consented to the sanction and to the entry of findings that he refused to provide testimony to FINRA related to allegations that he, in connection with private securities transactions, referred customers to an individual who was not registered and who may have recommended or sold unsuitable securities to those customers.

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”.

At this time it is unclear the nature and scope of Jamison’s activities.  Jamison’s disclosures include any outside business activities (OBAs) disclosures.  The only disclosure is an involvement with Crump Life Insurance.

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shutterstock_27786601-300x200According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) broker Thomas Williams (Williams) has been subject to five customer complaints and one termination for cause during his career.  Williams is currently employed by IFS Securities.  Several of the the customer complaints against Williams concern allegations of high frequency trading activity also referred to as churning and unsuitable investments.

In October 2018 a customer filed a complaint alleging their account was excessively traded, churning, and unsuitable investments.  The claim alleged $50,000 in damages and is currently pending.

In August 2010 Williams was terminated by First Allied Securities, Inc. (First Allied) in connection with allegations that a customer complained over unsuitable investments, misrepresentation, and breach of fiduciary duty.

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shutterstock_176351714-300x200According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) former advisor Judith Bufis (Bufis), formerly associated with Kovack Securities Inc. (Kovack Securities) in East Brunswick, New Jersey has been accused by FINRA over private securities transactions.

In October 2018 Bufis consented to the sanction and to the entry of findings that she failed to provide documents and information requested by FINRA in connection with potential private securities transactions.  In so doing she accepted a bar from the securities industry.

At this time it is unclear the nature or scope of the alleged outside business activities (OBAs) and private securities transactions.  Bufis public disclosures state that she engaged in the sale of insurance and annuities but discloses not other activities.

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shutterstock_20354401-300x200The securities attorneys at Gana Weinstein LLP are investigating claims against Fortune Financial Services, Inc. (Fortune Financial) broker Bruce Musselman (Musselman). According to BrokerCheck records, Musselman has been subject to nine customer complaints and one criminal regulatory action.

Most recently, in February 2013, customers alleged that Musselman recommended unsuitable investments, misrepresented securities, over-concentrated customer funds into aggressive investments, and excessively used margin. The dispute was settled at $14,900.

In August 2011, a customer alleged that from 2007 to 2009, Musselman recommended highly risky investments that were unsuitable and inappropriate to customer’s needs. The customer requested $80,000 in damages.

shutterstock_112866430-300x199Former IFS Securities, Inc. (IFS) and Voya Financial Advisors, Inc. (Voya) broker James Flynn (Flynn) has been subject to at least ten customer complaints, two employment terminations for cause, three tax or civil judgment liens, and one bankruptcy proceeding.  According to a BrokerCheck report many of the customer complaints concern alternative investments and direct participation products (DPPs) such as non-traded real estate investment trusts (REITs).  The attorneys at Gana Weinstein LLP have extensive experience handling investor losses caused by these types of products.

In February 2017 Voya discharged Flynn accusing the broker of providing misleading information to the firm during a complaint investigation.  Despite numerous customer complaints and financial troubles IFS hired Flynn anyway only to also discharge him a year later in February 2018.  IFS claims that Flynn was terminated because he executed unauthorized trades.

In addition, Flynn was subject to large tax liens totaling hundreds of thousands of dollars.  In April 2005 Flynn disclosed a tax lien of over $256,000.  Thereafter, Flynn declared bankruptcy in April 2013.  The fact that a broker cannot manage his own personal finances is material information for a client to consider.  In addition, the types of products clients have alleged were unsuitable are high commission products that may be recommended to generate high profits for the advisor at the expense of the client.

shutterstock_26269225-300x200According to BrokerCheck records financial advisor Coleman Devlin (Devlin), formerly associated with IFS Securities (IFS), has been subject to 14 customer complaints.  In addition, Devlin has been subject to two regulatory matters and has been terminated by two firms for cause.  In June 2016 Devlin was discharged from Stifel, Nicolaus & Company, Incorporated (Stifel, Nicolaus) on allegations of unauthorized trading.  Thereafter, The Financial Industry Regulatory Authority (FINRA) conducted its own investigation of Devlin’s trading activities.

In October 2017, FINRA found that Devlin effected discretionary trades in five customer accounts without obtaining prior written authorization from the customers and without acceptance of the accounts as discretionary by his member firm.

Devlin has also been subject to numerous customer complaints over the course of his career.  The most recent case was filed in November 2017 and alleged unsuitable investments.  The customer seeks $600,000 in damages and the claim is currently pending.

shutterstock_180968000-300x200According to BrokerCheck records financial advisor George Warner (Warner), currently associated with Chelsea Financial Services (Chelsea Financial), has been subject to one customer complaint, one regulatory action, and two terminations for cause.  According to records kept by The Financial Industry Regulatory Authority (FINRA), in June 2013, LPL Financial LLC (LPL Financial) terminated Warner for cause alleging that he obtained client signatures on black account transfer forms.  Thereafter, Warner was terminated from NFP Advisors Services (NFP Advisors) under similar circumstances.  NFP Adviosrs claimed in November 2014 that Warner corrected client documents after the client had signed them.

In April 2017, FINRA sanctioned Warner stated that Warner altered various customer documents on at least five occasions after the documents had already been signed by the customers. FINRA found that Warner corrected or included the customer’s anticipated liquidity needs, net worth, liquid net worth, and/or annual income on new account forms, alternative investment disclosure forms, and an IRA application.

Often times, brokers change client information or have clients sign documents in blank in order to use false information to purchase products that the client is otherwise not qualified to purchase.

shutterstock_80511298-300x218Broker James Lynn (Lynn) was recently terminated by his former employer Voya Financial Advisors, Inc. (Voya).  According BrokerCheck  Voya alleged that Lynn provided misleading information to the firm during a complaint investigation.  In addition to the termination, Lynn has been subject to six customer complaints, one bankruptcy and three judgments or tax liens.  The securities lawyers of Gana Weinstein LLP are investigating the customer complaints against Lynn.

Many of the complaints concern variable annuities or direct participation products (DPPs) such as non-traded real estate investment trusts (REITs).  The most recent complaint filed in May 2017 requested $115,000 in damages alleging that the investor claimed the that the REIT investments and the replacement of a variable annuity policy was unsuitable. The REITs were purchased in 2014 and 2015.  The claim is currently pending.

All of these investments come with high costs and historically have underperformed even safe benchmarks, like U.S. treasury bonds.  For example, products like oil and gas partnerships, REITs, and other alternative investments are only appropriate for a narrow band of investors under certain conditions due to the high costs, illiquidity, and huge redemption charges of the products, if they can be redeemed.  However, due to the high commissions brokers earn on these products they sell them to investors who cannot profit from them.  Further, investor often fail to understand that they have lost money until many years after agreeing to the investment.  In sum, for all of their costs and risks, investors in these programs are in no way additionally compensated for the loss of liquidity, risks, or cost.

shutterstock_20354398-300x200The securities lawyers of Gana Weinstein LLP are investigating customer complaints and a FINRA enforcement action with The Financial Industry Regulatory Authority’s (FINRA) against broker Michael Hebner (Hebner). According to BrokerCheck records, Hebner has been subject to five customer complaints and one employment termination for cause. The customer complaints against Hebner allege a number of securities law violations including that the broker made unsuitable investments and unauthorized trading among other claims.

Hebner was terminated in January 2015 by Wunderlich Securities, Inc. on allegations that Hebner failed to follow firm procedures regarding the approval and retention of correspondence.  The most recent claim was filed in January 2017 alleging Hebner made unsuitable recommendations from 2010 until 2014.  The customer claims that the activity caused $429,000 in damages.  The claim is currently pending.

Brokers have a responsibility treat investors fairly which includes obligations such as making only suitable investments for the client.  In order to make a suitable recommendation the broker must meet certain requirements.  First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors.  Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.

shutterstock_24531604-200x300Our firm is investigating claims made by The Financial Industry Regulatory Authority (FINRA) and the Securities Exchange Commission (SEC) against broker Richard Cody (Cody) that involves potentially millions in either stolen client funds or misrepresentations concerning the state of their accounts.  Cody is a formerly associated broker with brokerage firms Westminster Financial Securities, Inc. (Westminster), Concorde Investment Services, LLC (Concorde Investment), and IFS Securities (IFS).  Cody conducted his business through his advisory firm Boston Investment Partners.  According to brokercheck, Cody has been subject to three regulatory events, two investigations, and 15 customer disputes among other disclosures.

The SEC’s complaint lays out an astonishing scheme to defraud investors.  The SEC alleged that Cody would tell retired clients that their accounts were flourishing and making money when in fact they were dwindling to near-zero balances.  The SEC tells the tale of three clients who were lied to by Cody about their rapidly depleting retirement accounts through monthly deductions that were unsustainable.

Further, to make the scheme work Cody fabricated account statements, told clients they were withdrawing investment gains rather than depleting their principal, and sent a doctored document to indicate that a financial firm was holding an annuity on behalf of one client.  Cody’s conduct occurred over a 12 year period in which Cody was registered as a broker with five different independent firms.

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