Articles Tagged with Securities America

shutterstock_85873471-300x200Advisor Leslie Goldstein (Goldstein), currently employed by Securities America, Inc. (Securities America) has been subject to at least four customer complaints, two regulatory actions, and one employment termination for cause.  According to a BrokerCheck report some of the customer complaints 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 December 2018 a customer complained that Goldstein violated the securities laws by alleging that the financial advisor did not explain the impact of an early withdrawal from a variable annuity on the client’s future annuity income benefits. The claim was withdrawn.

In July 2018 a customer filed a complaint alleging that Goldstein violated the securities laws by alleging concentrated positions in illiquid investments, annuities, life insurance and non-traded REITs which were unsuitable. The allegations also include churning, excessive commissions, breach of fiduciary duty, and negligence. The claim alleged $1,000,000 in damages and is currently pending.

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shutterstock_20354401-300x200According to BrokerCheck records financial advisor Michael Heath (Heath), currently employed by Infinity Financial Services (Infinity Financial) has been subject to one regulatory action, two employment terminations for cause, and one civil lien during his career.  According to records kept by The Financial Industry Regulatory Authority (FINRA), the regulatory action against Heath concern allegations of unsupervised record activity.

In October 2018 FINRA alleged that Heath consented to the sanctions and findings that he regularly communicated with his customers through an unapproved personal email account about member firm business and circumvented the firm’s supervision.  FINRA found that in these emails Heath sent account documents, discussed account performances, and discussed specific investments with his customers. FINRA further found that the firm’s supervisory procedures required electronic business-related correspondence to be sent through firm issued or firm approved email accounts so that the firm could monitor such communications for recordkeeping and compliance purposes.  FINRA determined that by using unapproved personal email account Heath caused his firm to fail to maintain all business-related communications.  In addition, FINRA also found that Heath failed to comply with FINRA rules on communications with the public in that he created account performance summaries that he used in meetings with clients that failed to provide a sound basis for customers to evaluate the facts.

In March 2016 Heath was discharged by Securities America, Inc. (Securities America) on allegations that he failed to disclose internal investigation with previous broker dealer on his CRD update.

That disclosure followed Heath’s termination from First Allied Securities, Inc. (First Allied) where the firm terminated him for failing to comply with the firm’s email policies.

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shutterstock_189302954-300x203The securities attorneys at Gana Weinstein LLP are currently investigating Securities America, Inc. (Securities America) broker Randy Schneider (Schneider). According to BrokerCheck Records kept by the Financial Industry Regulative Authority (FINRA), Schneider has been subject to nine customer disputes. The majority of these customer disputes revolve around the unsuitable recommendation of alternative investments, annuities and REITs.

Most recently, in February 2015, a customer alleged that Schneider stole and misappropriated funds in the customer account and also misrepresented the nature of the AXA annuities by providing misleading information. The customer requested $160,000 in damages.

In June 2013, a customer alleged that from November 2007 to June 2008, Shneider misrepresented the nature of certain alternative investments that were unsuitable for the customer. The case was settled at $250,000.

In September 2011, a customer alleged that Schneider unsuitably recommended an alternative investment and misrepresented the facts of the investment. This dispute was settled at $38,750.

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shutterstock_145368937-300x225According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Howard Utz (Utz), formerly associated with Hazard & Siegel, Inc. (Hazard & Siegel) in Mars, Pennsylvania was terminated by his firm concerning allegations that Utz’s failed to report outside business activities, engaged in private securities transactions, and accepted checks from clients made personally payable to Utz and subsequent conversion to personal use.

In addition, in May 2018 the Federal Bureau of Investigation opened an investigation into Utz but have not disclosed any details of the investigation.  Similarly, in January 2018 the Securities and Exchange Commission (SEC) opened an investigation into Utz’s activities but again there are no disclosures concerning the nature of the investigation.

At this time, the selling away claims against Utz are unclear as to the exact nature and extent of the activity.  Utz has outside business disclosures including Noble and Utz Enterprises – a rental property business.  In addition, Utz discloses Utz Financial Services – his investment d/b/a among other disclosures.

shutterstock_183525509-300x200According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Hector May (May), formerly associated with Securities America, Inc. (Securities America) in New York, New York is under criminal investigation by the U.S. Department of Justice (DOJ) for investment fraud.  At the same time, May was terminated by Securities America on concerns that the advisor misappropriated client assets.

Investors who have come forward concerning May’s fraud claim that he sold what now appear to be fake tax-free corporate bonds.  It is doubtful that these investments ever existed.  Instead, the allegations claim that May most likely pocketed client funds and paid other clients funds with the proceeds from other investors – a classic Ponzi-scheme.  As with all Ponzi schemes this one collapsed when May could not make promised payments.

It appears that May conducted his alleged scheme through a disclosed outside business activity called Executive Compensation Planners, Inc.  May may have used this company to handle client investments and distribute fake returns to investors.  Outside business activities such as Executive Compensation Planners should have caused concern at May’s brokerage firm because these separate corporate entities are frequently used by unscrupulous advisors to conceal and commit frauds.  According to news sources, Executive Compensation Planners’ website in 2016 stated the firm was registered to sell securities and insurance but has since been taken down.  Further, May disclosed to clients in a brochure from Executive Compensation Planners that the firm handled more than $18 million in assets.

shutterstock_89758564-300x200Current Geneos Wealth Management, Inc. (Geneos Wealth) broker Kenneth Ancell (Ancell) has been subject to two customer complaints.  According to a BrokerCheck report many of the complaints concern alternative investments, private placements, and direct participation products (DPPs) such as non-traded real estate investment trusts (REITs).  Our firm has experience handling investor losses caused by these products.

In June 2017 customers filed a complaint alleging that in or around 2011, Ancell made unsuitable investment recommendations in REITs and alternative investments causing $744,038 in damages.  The claim is currently pending.

Our firm often handles cases involving direct participation products, private placements, Non-Traded REITs, oil and gas offerings, equipement leasing products, and other alternative investments.  These products are almost always unsuitable for middle class investors.  In addition, the brokers who sell them are paid additional commission in order to hype inferior quality investments providing perverse incentives for brokers to sell high risk and low reward investments.

shutterstock_155271245-300x300According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Bruce Barber (Barber), in September 2017, was accused by FINRA of engaging in an undisclosed outside business activity by serving as an advisor to the Board of Directors for ABC, LLC (ABC) and being compensated by the company with warrants.  According to FINRA, Barber solicited 15 clients to invest in ABC’s private securities offering.  At this time it unknown the full extent and scope of Barber’s outside business activities.

In February 2017, Barber’s then employer Securities America, Inc. (Securities America) terminated him stating Barber solicited customers to purchase an unapproved securities product and participated in an unapproved outside business activity.

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”.

shutterstock_112866430-300x199Former Cetera Advisor Networks LLC (Cetera) broker Susan Welo (Welo) has been subject to nine customer complaints, one employment separation for cause, and one regulatory action.  According to a BrokerCheck report Welo was terminated by Cetera after the firm alleged that Welo failed to disclose to firm that Welo provided a loan to a client while at a prior broker-dealer. In addition, Cetera claimed that Welo violated firm policies by accepting blank signed forms from clients and permitting assistant to sign representative’s name to various documents.

In addition, the State of North Dakota alleged that Welo acted as an unregistered securities agent by handling client funds and make investment recommendations.

Many of the complaints concern alternative investments, private placements, and direct participation products (DPPs) such as non-traded real estate investment trusts (REITs).  Our firm has experience handling investor losses caused by these products.

shutterstock_178801067Our investment attorneys are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against Paul Neves (Neves) currently associated with Securities America, Inc. (Securities America) alleging unsuitable investments, breach of fiduciary duty, common law fraud, and elder abuse among other claims.  According to brokercheck records Neves has been subject to five customer complaints.  Many of the complaints involve direct participation products (DPPs) such as non-traded real estate investment trusts (REITs), equipment leasing funds – such as LEAF or ICON, and other alternative investments.

In November 2015 a customer filed a complaint alleging unsuitable investments and elder abuse.  The customer claimed damages of $800,000.  The claim is currently pending.

Our firm has represented many clients in illiquid alternative investments products.  All of these investments come with high costs and have historically 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 at all.  However, due to the high commissions brokers earn on these products they sell them to investors who cannot profit from them and have created a large market for a failed product.  Further, investor often fail to understand that they have lost money in these illiquid investments until many years after investing.  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_162924044The securities lawyers of Gana Weinstein LLP are investigating customer complaints against broker Howard Slater (Slater). In addition, The Financial Industry Regulatory Authority (FINRA) brought an enforcement action (FINRA No. 2015046156301) against Slater. There are at least 18 customer complaints against Slater and 2 regulatory actions. The customer complaints against Slater allege a number of securities law violations including that the broker made unsuitable investments, misrepresentations, negligence, fraud, breach of fiduciary duty, and unauthorized trading among other claims.

The most recent customer complaint was filed in November 2013 and alleges unsuitable investments, fraud, and negligence concerning investments in alternative investments in real estate investments. The complaint seeks $90,000 in damages. In another complaint filed in July 2013, a customer complained that Slater misinformed her regarding the risks of three non-traded real estate investment trusts (Non-Traded REITs).

In a FINRA regulatory action against Slater, the agency alleged that in February 2008 and August 2008, Slater sent emails to two customers in connection with their purchases of IMH Secured Loan Fund, LLC (IMH Fund) that contained misrepresentations regarding the features of the IMH Fund. In addition, according to FINRA, in March 2008, Slater sent an email to a customer that contained exaggerated and misleading statements about the safety of the IMH Fund. Finally, FINRA found that in April 2008, Slater caused an SAI customer’s account records to reflect false annual income and net worth information that caused the business records maintained by his firm to be inaccurate.