unsuitable investments

Broker Spotlight: Customer Complaints Against PHX Financial Broker Johnathan McHale

January 28, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker Johnathan McHale (McHale). According to BrokerCheck records there are at least 6 customer complaints, one employment separation for cause, and 6 judgments or liens that have been filed against McHale. The most recent customer complaint against McHale filed in April 2014 alleges that McHale breached his fiduciary duty, negligence, and misrepresentations in the handling of the customer’s account leading to $108,000 in damages. The claim was settled for $14,995. In August 2012, another client alleged that McHale engaged in unsuitable investments leading to $43,000 in damages. The claim was denied.

In May 2014, National Securities Corporation terminated McHale alleging that he violated the firm’s policy by using his personal email address for business correspondence. In addition, McHale has 6 judgements. One tax lien filed in March 2011 for $34,598. Substantial judgements and liens on a broker’s record can reveal a financial incentive for the broker to recommend high commission products or services. A broker’s inability to handle their personal finances has also been found to be relevant in helping investors determine if they should allow the broker to handle their finances

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.

Broker Investigation: 13 Customer Complaints Against Aegis Capital Broker Keith Connolly

January 27, 2016 | by Staff Attorney

The securities fraud lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker Keith Connolly (Connolly). According to BrokerCheck records there are at least 13 customer complaints against Connolly. The customer complaints against Connolly allege a number of securities law violations including that the broker made unsuitable investments, misrepresentations, failure to supervise, unauthorized trading, and churning (excessive trading) among other claims. The most recent customer complaint filed in October 2014 alleged churning, negligence, unsuitability, overconcentration resulting in damages of $187,855 in damages. The claim is still pending. In August 2014, another client filed a complaint alleging administering the customer’s brokerage accounts claiming damages of 776,326. The claim was resolved settling for $450,000.

As a background, 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.

The number of customer complaints against Connolly is high relative to his 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.

Broker Investigation: Churning Claims Against National Securities Corporation Broker Shaun Stein

January 23, 2016 | by Staff Attorney

The securities fraud lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker Shaun Stein (Stein). According to BrokerCheck records there are at least 3 customer complaints against Stein. The customer complaints against Stein allege a number of securities law violations including that the broker made unsuitable investments, misrepresentations, breach of fiduciary duty, and churning (excessive trading) among other claims. The most recent customer complaint filed in July 2015 alleged churning and mishandling of the account claiming $60,000 in damages. The claim is still pending. In June 2014, another client filed a complaint alleging unsuitable investments, fraud, unfair trade practices and other claims claiming damages of $75,000. The claim has been closed.

As a background, 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.

The number of customer complaints against Stein is high relative to his 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.

Broker Investigation: Churning Claims Against Aegis Broker Michael Venturino

January 22, 2016 | by Staff Attorney

The securities fraud lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker Michael Venturino (Venturino). According to BrokerCheck records there are at least 2 customer complaints against Venturino. The customer complaints against Venturino allege a number of securities law violations including that the broker made unsuitable investments, misrepresentations, negligence, and churning (excessive trading) among other claims. The most recent customer complaint filed in June 2014 alleged excessive mark-ups or commissions claiming $125,000 in damages. The claim is still pending. In March 2014, another client filed a complaint alleging unsuitable investments, unauthorized trading, and churning among other claims claiming damages of $140,368. The claim is still pending.

As a background, 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.

The number of customer complaints against Venturino is high relative to his 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.

Broker Spotlight: Customer Complaints Against Merrill Lynch Broker John Boukamp

January 22, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker John Boukamp (Boukamp). According to BrokerCheck records there are at least 10 customer complaints that have been filed against Boukamp. The most recent customer complaint against Boukamp filed in November 2013 alleges that Boukamp, from December 2011 until September 2013 engaged in excessive trading, sometimes referred to as churning, and made unsuitable investments. This complaint was denied. In October 2013, another customer complained and alleged unsuitable investment recommendations and unauthorized trading from June 2012 to September 2012 resulting in a loss of $522,000. The case was resolved with the customer receiving $275,000.

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.

The number of customer complaints against Boukamp is high relative to his 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.

Broker Spotlight: Customer Complaints Against UBS Broker Michael Blueweiss

January 20, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker Michael Blueweiss (Blueweiss). According to BrokerCheck records there are at least 6 customer complaints against Blueweiss. The most recent customer complaint against Blueweiss filed in November 2014 alleges that Blueweiss concentrated the client in structured products, annuities failed to disclose surrender penalities, and churning. Another customer complaint filed in February 2011 alleged that unsuitable investments in UBS reversed convertibles linked to the common stock of Lehman Brothers.

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.

The number of customer complaints against Blueweiss is high relative to his 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.

Morgan Stanley Broker Lance Slater Terminated After Allegations Of Personal Loans and Excessive Trading

January 18, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker Lance Slater (Slater). According to BrokerCheck records there are at least 2 customer complaints against Slater and one employment separation. The most recent customer complaint against Slater alleges that from 2013 Slater borrowed $210,000 from the client and then tried to hide that fact from her children and has not since then paid the client back. The client also alleges that Slater engaged in unsuitable investments and excessive trading.

Shortly thereafter Morgan Stanley discharged Slater making allegations Slater failed to adhere to the firm’s guidance regarding certain sales activity and possible involvement in an unreported loan from a customer while at a prior firm.

As a background, 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.

Broker Investigation: Advisor Dennis Riordan

January 7, 2016 | by Staff Attorney

The investment lawyers of Gana Weinstein LLP are investigating customer complaints against broker Dennis Riordan (Riordan). According to Riordan’s BrokerCheck records there are at least 3 customer complaints against Riordan, 1 judgment or lien, and 2 criminal matters. The customer complaints against Riordan allege a number of securities law violations including that the broker made unsuitable investments, excessive trading, and failure to follow instructions among other claims.

The most recent disclosure filed in February 2015 concerns a tax lien for $33,287. Tax liens and judgements are often a sign that the broker cannot manage their own personal finances and may be tempted to recommend high commission products or strategies to clients in order to satisfy debts. The most recent complaint against Riordan was filed in December 2013 and alleges an unsuitable recommendation in a private placement security.

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.

Gana LLP Investigation: Excessive Trading Complaints Against Broker James Bernthal

January 5, 2016 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating customer complaints filed with The Financial Industry Regulatory Authority’s (FINRA) against broker James Bernthal (Bernthal). According to BrokerCheck records there are at least 4 customer complaints against Bernthal and 1 judgments or liens. The customer complaints against Bernthal allege a number of securities law violations including that the broker made unsuitable investments, misrepresentations, excessive trading, and unauthorized trading, among other claims.

According to the disclosures, the most recent customer complaint against Bernthal was filed in February 2013 and alleged $100,000 in damages due to unsuitable trades and excessive transactions. The case was resolved for $50,000.

As a background, 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.

Broker Investigation: Wells Fargo Advisor Robert Giusti

January 3, 2016 | by Staff Attorney

The investment lawyers of Gana Weinstein LLP are investigating customer complaints against broker Robert Giusti (Giusti). There are at least 4 customer complaints against Giusti and one civil action. The customer complaints against Giusti allege a number of securities law violations including that the broker made unsuitable investments, misrepresentations, negligence, and excessive trading among other claims.

The most recent complaint was filed in April 2015 and alleged unsuitable investments and excessive trading among other claims for investments made between 2010 through June 2015 causing the investor $1,326,374 in damages. A civil judgment was filed against Giusti in April 2015 for $1,100,000. Another complaint filed in January 2012 alleged unsuitable investments and unauthorized use of margin funds causing $45,000.

Giusti entered the securities industry in 1995. From November 2006 through June 2009, Giusti was associated with Citigroup Global Markets Inc. Thereafter, from June 2009 through September 2009, Giusti was briefly associated with Morgan Stanley Smith Barney. From August 2009 until December 2013, Giusti was associated with Merrill Lynch, Pierce, Fenner & Smith Incorporated. Finally, since December 2013, Giusti has been registered with Wells Fargo Advisors, LLC out of the firm’s New York, New York office location.