Articles Tagged with Newbridge Securities

shutterstock_112866430-300x199According to BrokerCheck records financial advisor Jesse Krapf (Krapf), currently employed by Benchmark Investments, Inc. (Benchmark Investments) has been subject to at least one customer complaint and two debt related judgements or tax liens.  According to records kept by The Financial Industry Regulatory Authority (FINRA), most of Krapf’s customer complaints allege that Krapf made was negligent and breached his fiduciary duty to the customer.

In October 2018 a customer filed a complaint alleging that Krapf violated the securities laws including negligence and breach of fiduciary duty causing $500,000 in damages.  The claim is currently pending.

Krapf also has two unsatisfied debts including a $3,247 tax lien from May 2015.  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.

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Acshutterstock_123758422-300x200cording to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) broker Dana Davis (Davis) has been subject to seven customer complaints and one termination for cause.  Davis is currently employed by Newbridge Securities Corporation (Newbridge Securities).  Many of the customer complaints against Davis concern allegations of high frequency trading activity also referred to as churning, unauthorized trading, and unsuitable investments.

In January 2018 a customer filed a complaint alleging misrepresentation, unsuitable and excessive trading, negligent supervision, and breach of fiduciary duty.  The claim alleges $250,000 in damages and is currently pending.

In October 2011 a customer filed a complaint alleging excessive transactions claiming $9,078 in damages.  The complaint was closed.

In September 2006 Davis was terminated from First Montauk Securities Corp. after allegations were made that Davis failed to follow procedures concerning unauthorized trading.

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shutterstock_99315272-300x300According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) former Newbridge Securities Corporation (Newbridge Securities) broker Edward Klug (Klug) left the securities industry in May 2018 after disclosing several large tax liens in the prior years.  Klug has made seven financial related disclosures and lists four customer complaints.  The customer complaints against Klug allege churning or excessive trading.

In March 2018 Klug disclosed a $141,711 tax lien against him.  In May 2017, Klug disclosed a $482,714 tax lien against him.  Prior to that, in April 2016 Klug disclosed a $44,229 tax lien against him.  Such disclosures on a broker’s record can reveal a financial incentive for the broker to recommend high commission products or services.  FINRA discloses information concerning a broker’s financial condition because a broker’s inability to handle their own personal finances has also been found to be material information in helping investors determine if they should allow the broker to handle their finances.

When brokers engage in excessive trading, sometimes referred to as churning, the broker will typical trade in and out of securities, sometimes even the same stock, many times over a short period of time.  Often times the account will completely “turnover” every month with different securities.  This type of investment trading activity in the client’s account serves no reasonable purpose for the investor and is engaged in only to profit the broker through the generation of commissions created by the trades.  Churning is considered a species of securities fraud.  The elements of the claim are excessive transactions of securities, broker control over the account, and intent to defraud the investor by obtaining unlawful commissions.  A similar claim, excessive trading, under FINRA’s suitability rule involves just the first two elements.  Certain commonly used measures and ratios used to determine churning help evaluate a churning claim.  These ratios look at how frequently the account is turned over plus whether or not the expenses incurred in the account made it unreasonable that the investor could reasonably profit from the activity.

shutterstock_141873055-300x268Securities firm Gana Weinstein LLP is investigating Newbridge Securities Corporation (Newbridge Securities) broker Jeffrey Eglow (Eglow). According to BrokerCheck records, Eglow has been subject to 4 customer complaints and one criminal action. The majority of these disputes involve unsuitable, over-concentrated alternative investments.

In May 2017, a customer alleged that Eglow overcharged customers fees for trading which resulted in damages of $48,758. The customer’s request for damages was fully remedied by the court.

In July 2016, a customer alleged that Eglow placed over-concentrated investments in Unit Investment Trusts (UITs) and energy securities which was unsuitable to the customer and resulted in unrealized losses. In addition, Eglow leveraged Exchange-Traded Funds (ETF) in long positions also resulted in losses to the customer. The case was settled at $115,000.

shutterstock_34872913-300x209Former Newbridge Securities Corporation (Newbridge) broker Austin Dutton (Dutton) has been subject to two complaints and a recent sanction citing dishonest or unethical practices in the securities business by the Pennsylvania Department of Banking and Securities and fining Dutton $200,000.  According to a BrokerCheck report Dutton recommended the purchase of a security to at least one customer without reasonable grounds to believe that the transaction was suitable for the customer.

In addition, Dutton’s firm, Newbridge, was also sanctioned by the state of Pennsylvania on findings that “From in or about January 2012 until December 2016, Newbridge did not maintain a reasonable system for applying and enforcing written procedures pertaining to their sales of structured products by one agent in Pennsylvania to certain of his clients…”  While The order does not name the broker it appears reasonably related to Dutton.

According to newssources, Dutton is known to have recommended and sold and direct participation products (DPPs) such as non-traded real estate investment trusts (REITs).  In particular Dutton sold real estate investment trusts formerly managed by Nicholas Schorsch’s private firm, American Realty Capital (ARC), now AR Global.  An accounting scandal affected ARC and its REITs.  According to sources, Dutton sold these products to retirees and police officers.

shutterstock_115937266-300x237According to BrokerCheck records Gaetano “Guy” Magarelli (Magarelli), now associated with Newbridge Securities Corporation (Newbridge), has been subject to five customer complaints and one lien.  According to records kept by The Financial Industry Regulatory Authority (FINRA) Magarelli has been accused by customers of unsuitable investment advice.  Some customers have also alleged unauthorized trading among other claims.

The most recent complaint filed in June 2017 alleges $84,000 in damages stemming from a two year period.  The claim is currently pending.  Another claim was filed by a customer in March 2017 alleging that there were unsuitable trades from 2010 through 2017 causing $131,000 in damages.  The claim has been denied by the firm.

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_123758422-300x200Gana Weinstein LLP is investigating claims made by Financial Industry Regulatory Authority (FINRA) against broker David Menashe (Menashe). According to BrokerCheck records, Menashe was ordered to pay a restitution of $15,000 by the state of Montana for alleged excessive trading and unauthorized trading in June 2016.

Menashe entered the industry in 2009. He is currently registered and employed at Newbridge Securities, where he has been employed since January 2017. His past employment includes:

• Joseph Stone Capital LLC (February 2013 – January 2017)

shutterstock_103681238-300x300Our securities fraud attorneys are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against David Fagenson (Fagenson) currently associated with Newbridge Securities Corporation (Newbridge) alleging Fagenson engaged in a number of securities law violations including that the broker made unsuitable investments and unauthorized trading among other claims.  According to BrokerCheck, Fagenson currently has nine customer complaints, one criminal matter, two regulatory actions, and one employment termination for cause.

In September 2016 UBS terminated Fagenson after a review found that while on heightened supervision Fagenson violated firm policy by exercising time and price discretion, texting with clients and engaging in short term trading of preferred shares.  Also in September 2016 a customer alleged that from 2013 through 2016 that Fagenson engaged in unauthorized trading and gave stop loss orders that were not entered.  The complaint is currently pending.

In April 2011 Fagenson was sanctioned by the state of Florida for failing to disclose a criminal matter on his record that was required to be disclosed.

shutterstock_94632238In May 2016 the Department of Justice (DOJ) filed a five-count indictment in New York against nine defendants including Jared Mitchell, the Managing Partner of Mitchell & Sullivan Capital LLC; Richard Brown, a registered broker with Chelsea Financial Services; Christopher Castaldo, the Chief Executive Officer of Stock Traders Press Inc. and the President of Wall Street Buy Sell Hold Inc.; Gerald Cocuzzo, also known as “Gerry,” a registered broker formerly with Newbridge Securities Corporation; Naveed Khan, also known as “Nick,” a registered broker formerly with Meyers Associates, L.P.; Herschel Knippa III, also known as “Tres,” the owner and Head Trader at Kenai Capital Management LLC; Maroof Miyana, a registered broker formerly with Legend Securities; Pranav Patel, a registered broker formerly with Dawson James Securities; and Louis Petrossi, the founder and Chief Executive Officer of the Wealth Research Institute.

The DOJ’s charges involve the unlawful sale and activity related to stock ForceField Energy Inc. (ForceField), a publicly-traded company under the ticker symbol “FNRG.”  The charges include securities fraud, conspiracy to commit securities fraud, wire fraud, money laundering and making a false statement to law enforcement officials in connection with the fraudulent market manipulation of the stock.

The DOJ alleged that the defendants employed of scheme together with dishonest registered brokers to perpetrate an elaborate but fraudulent scheme built on lies, kickbacks and manipulated trading activity.  The defendants essentially used a company with no business operations and little revenue and deceived the market and their clients into believing it was worth hundreds of millions of dollars through unauthorized trades and deceptive promotions.

shutterstock_180412949The law offices of Gana Weinstein LLP recently filed a statement of claim with FINRA on behalf of their 60 year old client concerning inappropriate investments in private placements, non-traded real estate investment trusts (Non-Traded REITs), low priced securities, and private securities transactions.  The complaint was filed against Newbridge Securities Corporation (Newbridge) and alleges that the firm’s broker Dennis Hayes (Hayes) recommended these unsuitable transactions.  In total the Claimant alleges approximately $750,000 in damages.

According to the Statement of Claim, the Claimant divorced her husband in 2012 leaving her with approximately $1,500,000 in assets of which $500,000 was non-qualified money and about $1 million was qualified IRA funds. Claimant explained to Hayes that her goals were to protect her assets while providing her with returns to meet her immediate income needs.  Shortly after transferring the funds, Hayes solicited the Claimant to invest in a gold fund called USA Gold.  According to the complaint, Hayes recommended $300,000 in USA Gold through a self-directed IRA account.

The complaint alleges that after a diligent search there appears to be no Regulation D filing for a private placement for USA Gold and no evidence of any registration of the offering.  USA Gold appears to be an unregistered securities offering and most likely an investment scam.  Even more shocking is that Newbridge has failed to properly investigate and terminate Hayes for his involvement in the unregistered offering thereby continuing to place investors at risk. According to the Statement of Claim, Claimant complained to Gene Robert Abrams (Abrams), Newbridge’s General Counsel and Co-Chief Compliance Officer that Hayes was involved in private securities transactions.