Oppenheimer

Securities Investigation: Broker Gregg Templeton

March 31, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against broker Gregg Templeton (Templeton). According to BrokerCheck records Templeton is subject to six customer complaints and one employment separation. The recent customer complaints against Templeton allege securities law violations that including misrepresentations, breach of fiduciary duty, and negligent supervision among other claims. The claims appear to largely relate to allegations regarding promissory notes and penny stocks.

The most recent complaint filed in January 2016 alleges that between December 2013 and May 2015 the customer claims to have been defrauded out of $6,750,000 through misrepresentations in what appear to be penny stocks while Templeton was associated with Oppenheimer & Co. Inc. (Oppenheimer) out of the firm’s New York, New York office location. The dispute is currently pending.

Our firm has represented many clients in who have suffered losses due to inappropriate penny stock trading and manipulation claims. Penny stocks and low priced securities are favorite targets for investment fraud because they are easily manipulated and allow schemers to profit from their victims investments.

Broker Investigation: Financial Advisor Mark Hughes

November 23, 2015 | by Staff Attorney

The attorneys at Gana Weinstein LLP are interested in speaking with investors of broker Mark Hughes (Hughes) According to the BrokerCheck records kept by Financial Industry Regulatory Authority (FINRA) Hughes has been the subject of at least 7 customer complaints, and 1 regulatory action over the course of his career. The customer complaints against Hughes allege securities law violations that claim excessive trading, unsuitable investments, and unauthorized trading among other claims. The most recent complaint was filed in November 2011, and alleged $500,000 in losses due to unsuitable variable annuities.

The most recent regulatory action was taken by the state of Virginia in 2010, when the state alleged that Hughes violated the states laws by offering and selling leveraged exchanged traded funds (Non-Traditional ETFs) to two Virginia residents when the investment was not suitable for them given their investment objectives, financial situation, risk tolerance, experience, and investment needs. The allegations were settled with the state and resulted in sanctions of $620,000 and the imposition of heightened supervision.

Hughes entered the securities industry in 1993. From June 2004, until November 2007, Hughes was associated with Suntrust Investment Services Inc. From October 2007, until November 2014, Hughes was associated with UBS Financial Services Inc. Presently, Hughes is associated with Oppenheimer & Co. Inc. out of the firm’s Washington, DC branch office location.

Broker Investigation: Laidlaw & Company Advisor Joseph Fedorko

November 19, 2015 | by Staff Attorney

According to the BrokerCheck records kept by Financial Industry Regulatory Authority (FINRA) broker Joseph Fedorko (Fedorko) has been the subject of an astonishing 16 customer complaints. The customer complaints against Fedorko allege securities law violations that claim churning and excessive trading, unsuitable investments, unauthorized trading, fraud, misrepresentations, and breach of fiduciary duty among other claims. The most recent complaint was filed in March 2014, and alleged $292,771 in losses due to an unsuitable investment strategy from 2011 until 2013. The case settled for $120,000. Another complaint filed in November 2012, alleged $400,000 in damages stemming from trading that began in 2011. Other complaints against Fedorko when combined allege millions in investor losses.

Fedorko entered the securities industry in 1989. From January 2002, until May 2009, Fedorko was associated with with Oppenheimer & Co. Inc. Presently, Fedorko is associated with Laidlaw & Company (UK) Ltd. out of the firm’s Stamford, Connecticut branch office location.

All advisers have a fundamental responsibility to deal fairly with investors including making suitable investment recommendations. In order to make suitable recommendations the broker must have a reasonable basis for recommending the product or security based upon the broker’s investigation of the investments properties including its benefits, risks, tax consequences, and other relevant factors. In addition, the broker must also understand the customer’s specific investment objectives to determine whether or not the specific product or security being recommended is appropriate for the customer based upon their needs.

Broker Investigation: Feltl & Company Advisor Timothy Wynne

November 19, 2015 | by Staff Attorney

According to the BrokerCheck records kept by Financial Industry Regulatory Authority (FINRA) broker Timothy Wynne (Wynne) has been the subject of at least 5 customer complaints. The customer complaints against Wynne allege securities law violations that claim churning and excessive trading, unsuitable investments, unauthorized trading, fraud, misrepresentations, and discretionary trading among other claims. The most recent complaint was filed in October 2014, and alleged $500,000 in losses due to churning and excessive commission charges from February 2012 through October 2014. Another complaint filed in July 2014, alleged over $3.3 million in damages caused by unsuitable discretionary trading. Another complaint also filed in July 2014 alleged unsuitable investments in Monticello MN Telecommunication municipal bonds.

Wynne entered the securities industry in 1986. From January 2002, until February 2012, Wynne was associated with with Oppenheimer & Co. Inc. Presently, Wynne is associated with Feltl & Company out of the firm’s Minneapolis, Minnesota branch office location.

Churning is investment trading activity in the client’s account that serves no reasonable purpose for the investor and is transacted solely to profit the broker. The elements to establish a churning claim, which is considered a species of securities fraud, 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.

Broker Investigation: Oppenheimer Advisor Matthew Giannone

November 18, 2015 | by Staff Attorney

According to the BrokerCheck records kept by Financial Industry Regulatory Authority (FINRA) broker Matthew Giannone (Giannone) has been the subject of at least 6 customer complaints. The customer complaints against Giannone allege securities law violations that claim churning and excessive trading, unsuitable investments, unauthorized trading, fraud, misrepresentations, and inappropriate loans among other claims. The most recent claim filed against Giannone claims $1,200,000 in damages due to churning and an inappropriate loan. The complaint was denied and closed.

Giannone entered the securities industry in 1997. From June 1997, until June 2005, Giannone was associated with Citigroup Global Markets Inc. From May 2005, until March 2013, Giannone was associated with Merrill Lynch, Pierce, Fenner & Smith Incorporated. Finally, since May 2013, Giannone has been registered with Oppenheimer & Co. Inc. out of the firm’s New York, New York branch office location.

Churning is investment trading activity in the client’s account that serves no reasonable purpose for the investor and is transacted solely to profit the broker. The elements to establish a churning claim, which is considered a species of securities fraud, 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.

Customers File Dozens of Complaints Against Former Oppenheimer Broker Bennett Broad

October 13, 2015 | by Staff Attorney

According to the BrokerCheck records kept by Financial Industry Regulatory Authority (FINRA) broker Bennett Broad (Broad) has been the subject of an astonishing 28 customer complaints and one regulatory matter over the course of his career. Customers have filed complaints against Broad alleging securities law violations including that the broker made unsuitable investments, negligence, unauthorized trading, misrepresentations, and churning and excessive trading, among other claims. In total the customer complaints allege several million dollars in damages. In May 2015, FINRA sought to investigate Broad and his activities and requested that the broker provide the regulator with information. Broad failed to respond to FINRA’s requests and was consequently subject to an automatic bar from the industry. The details of FINRA’s requests and investigation is not available at this time.

Broad entered the securities industry in 1979. From March 2003 until April 2015, Broad was associated with Oppenheimer & Co. Inc. out of the firm’s Jenkintown, Pennsylvania office.

All advisers have a fundamental responsibility to deal fairly with investors including making suitable investment recommendations. In order to make suitable recommendations the broker must have a reasonable basis for recommending the product or security based upon the broker’s investigation of the investments properties including its benefits, risks, tax consequences, and other relevant factors. In addition, the broker must also understand the customer’s specific investment objectives to determine whether or not the specific product or security being recommended is appropriate for the customer based upon their needs.

SEC Charged 36 Brokerage Firms Over Municipal Bond Offerings

August 12, 2015 | by Staff Attorney

The Securities and Exchange Commission (SEC) announced enforcement actions against 36 municipal bond underwriting brokerage firms for material misstatements and omissions in municipal bond offering documents. The SEC offered favorable settlement terms to municipal bond underwriters and issuers who self-reported securities law violations leading to the settlements.

The SEC alleged that between 2010 and 2014, 36 brokerage and financial firms violated federal securities laws by selling municipal bonds using offering documents that contained materially false statements or omissions about the bond issuers’ compliance with their obligation to disclosure. The firms were also alleged by the SEC to have failed to conduct adequate due diligence to identify the misstatements and omissions before offering and selling the bonds to their customers.

The municipal bond market is a $3.7 trillion market. Continuing disclosure provides municipal bond investors with information about the solvency and financial fitness of issuers on an ongoing basis. The SEC had previously identified issuers’ failure to comply with their continuing disclosure obligations as being a major challenge for investors seeking up to date information about their municipal bond holdings.

Cushing Mutual Funds Investor Update

August 4, 2015 | by Staff Attorney

The attorneys at Gana Weinstein LLP have been following the collapse of a series of mutual funds managed by Cushing Asset Management. The funds involved include:

Cushing Closed-End Funds

Cushing Renaissance Fund

Broker Investigation: Advisor Mark Gardner

July 1, 2015 | by Staff Attorney

According to the BrokerCheck records kept by Financial Industry Regulatory Authority (FINRA) broker Mark Gardner (Gardner) has been the subject of at least nine customer complaints, one firm termination, and one regulatory action. Customers have filed complaints against Bell alleging a number of securities law violations including that the broker made unsuitable investments among other claims. Most of these claims involve recommendations in equities.

Gardner entered the securities industry in 1977. Since 2008, Gardner has been associated with Oppenheimer & Co. Inc. until November 2008. From December 2010 until July 2012, Gardner was associated with Lake Forest Securities LLC. Currently, Gardner is associated with J.H. Darbie & Co., Inc.

In the regulatory action that was brought against Gardner, FINRA alleged that on or about November 5, 2008, Gardner executed three equity securities purchase transactions to open an investment account on behalf of a corporation without that corporation’s knowledge. FINRA found that Gardner accepted the purchase orders from a person who did not have authorization to act on behalf of the corporation. In addition, FINRA found that Gardner failed to verify whether the individual who placed the purchase orders had been granted authorization by the corporation. The transactions in question totaled $2,203,020.

Broker Investigation: Patrick McGrath Former Oppenheimer & Co. Advisor

May 31, 2015 | by Staff Attorney

According to the BrokerCheck records kept by Financial Industry Regulatory Authority (FINRA) broker Patrick McGrath (McGrath) has been the subject of at least four customer complaints, two regulatory actions, and one termination over the course of his career. Customers have filed complaints against McGrath alleging a litany of securities law violations including that the broker received loans and failed to pay the client timely, made unsuitable investments, and unauthorized trades, among other claims.

McGrath entered the securities industry in 1984 with brokerage firm Merrill Lynch, Pierce, Fenner & Smith Incorporated. Thereafter, from July 2003, until April 2009, 2007 through June 2009, McGrath was associated with brokerage firm Wachoiva Securities, LLC. Then, from April 2009 until January 2014, McGrath was a representative with Oppenheimer & Co. Inc. (Oppenheimer). Finally since February 2014, McGrath has been registered with Northeast Securities, Inc.

McGrath was permitted to resign from Oppenheimer in January 2014 due to his failure to finalize arrangements to repay money he borrowed from an Oppenheimer customer. There are also two regulatory actions against McGrath. One is a 30 day suspension and a $10,000 fine by the Florida Office of Financial Regulation based on allegations that McGrath engaged in prohibited business practices. FINRA also suspended McGrath for four months and fined him $10,000 concerning allegations that he borrowed money from a client contrary to Oppenheimer’s compliance policies that bar loan arrangements.