Articles Tagged with Wells Fargo

shutterstock_173509961-300x200The law offices of Gana Weinstein LLP are currently investigating claims that advisor Robert Montes (Montes) engaged in undisclosed outside business activities (OBAs) and investment sales that were not approved by his brokerage firm.  Montes, formerly registered with Morgan Stanley was subject to a regulatory investigation according to records kept by The Financial Industry Regulatory Authority (FINRA).  In addition, Montes disclosed three customer complaints.

In July 2019, FINRA alleged that Montes accepted a bar from the financial industry, without admitting or denying the findings, that he refused to provide documents and information requested by FINRA in connection with an investigation into whether he potentially misused an elderly customer’s assets.

At this time it is unclear what the activity was that was the focus of FINRA’s investigation or the scope of Montes’ activities.  Montes’ publicly available BrokerCheck information discloses several OBAs including a real estate venture and a company called R.J.R. Asset Management, LLC.  It is unknown whether the activity investigated by FINRA involves any of these entities.

Our law firm has significant experience bringing cases on behalf of defrauded victims when their advisors engage in receiving loans from clients or selling fraudulent securities sales through OBAs.  The sale of unapproved investment products – is a practice known in the industry as “selling away” – a serious violation of the securities laws.  In the industry the term selling away refers to when a financial advisor solicits investments in companies, promissory notes, or other securities that are not pre-approved by the broker’s affiliated firm.  Sometimes those investments have some legitimacy but often times these types of investments can end up being Ponzi schemes or the advisor can be engaging in the conversion of funds.

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shutterstock_152933045-300x200According to BrokerCheck records financial advisor Leonard Kinsman (Kinsman), currently employed by Wells Fargo Advisors Network, LLC (Wells Fargo) has been subject to at least five customer complaints during the course of his career.  According to records kept by The Financial Industry Regulatory Authority (FINRA), Kinsman’s customer complaints allege that Kinsman recommended unsuitable securities recommendations among other allegations of misconduct in the handling of customer accounts.

In addition, a recent Washington Post article exposed how brokerage firms as large as Wells Fargo still hire brokers with troubling work histories.  Kinsman had prior multiple complaints from clients and worked for two banned brokerages firms.  One firm was Meyers Pollock Robbins, a notorious bucket shop whose ex-president pleaded guilty to charges of engaging in a pump-and-dump stock scheme.  The fraud was alleged to have been linked to a bribery scheme coordinated by organized crime.

Recently, Kinsman was the subject to a new customer complaint where the client accused the broker of losing a $2.25 million insurance settlement after the client’s husband died unexpectedly in 2011.  The complaint alleges aggressive options trading and false documentation.

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shutterstock_123758422-300x200According to BrokerCheck records financial advisor Richard Bernstein (Bernstein), currently employed by Wells Fargo Clearing Services, LLC (Wells Fargo) has been subject to at least eight customer complaints during the course of his career.  According to records kept by The Financial Industry Regulatory Authority (FINRA), Bernstein’s customer complaints allege that Bernstein recommended unsuitable investments and securities among other allegations.

In February 2019 a customer filed a complaint alleging that Bernstein violated the securities laws by, among other things, that the client is seeking at least $53,000.00 in damage and claims that from February 2013 to July 2015 the advisor made unauthorized trades which conflicted with the client’s stated investment goals.  The claim is currently pending

In January 2019 a customer filed a complaint alleging that Bernstein violated the securities laws by, among other things, that from 2015 through 2016 the advisor made unsuitable investments.  The claim is currently pending.

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shutterstock_57938968-200x300The law offices of Gana Weinstein LLP filed a claim on behalf of a retired 66 years old widow concerning the mismanagement of her retirement savings.  The case alleged that Wells Fargo representative Allen Wilson (Wilson) recommended an overconcentration in unsuitable structured products that caused devastating losses to the Claimant’s portfolio jeopardizing her retirement.

Claimant alleged that she and her husband met Wilson in 2001 and for some time her savings were concentrated mostly in corporate and municipal bonds.  The Claimant alleged that she told Wilson that she was retired, collected social security, and wanted additional income from her accounts to cover expenses while preserving principal.  However, Wilson began recommending very complex structured products that the ordinary investor would not be able to understand.  These structured products were alleged to not be appropriate investments for income and a desire for preservation of capital.

The structured products at issue referenced two different bond yield curves and one stock market index in order to compute both if interest is owed paid and how much.  As alleged, a probability and statistics degree is needed to even begin to comprehend the probabilities of payment on this instrument.

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shutterstock_184429547-300x200According to BrokerCheck records financial advisor Sam Aziz (Aziz), formerly employed by David A. Noyes & Co. (David Noyes) has been subject to at least three customer complaints, one regulatory investigation, and two terminations for cause.  According to records kept by The Financial Industry Regulatory Authority (FINRA), most of Aziz’s customer complaints allege that Aziz made unsuitable recommendations in a variety of investments.

In October 2018 FINRA opened an investigation into Aziz’s activities.  On October 24, 2018, FINRA made a preliminary determination to recommend that disciplinary action be brought against Aziz alleging that he made potential violations, specifically excessive trading and unsuitable recommendations of the use of margin), attempting to settle away a customer’s complaint), and use of an undisclosed personal email account and text messages to conduct securities business.

In October 2018 Aziz’s firm, David Noyes, terminated him citing the FINRA investigation as a reason.

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shutterstock_85873471-300x200According to BrokerCheck records financial advisor Russell Blum (Blum), currently employed by International Assets Advisory, LLC (International Assets) has been subject to two customer complaints, one tax lien, and one employment termination for cause during his career.  According to records kept by The Financial Industry Regulatory Authority (FINRA), the complaints against Blum concern allegations of unsuitable investments and allegations of overconcentration.

In August 2018 Blum was terminated by SunTrust Investment Services over allegations that the representative did not follow firm procedure regarding updates to his Investment Advisor brochure supplement.

In May 2017, Blum disclosed a tax lien of $99,000 with the IRS.  The fact that a broker cannot manage his own personal finances is material information for a client to consider.  In addition, an advisor with poor personal finances may be incentivized to sell unsuitable or high commission products that may be recommended to generate high profits for the advisor at the expense of the client.

In May 2016, a customer complained that Blum recommended investments that caused over $1.3 million in damages.  The claim was denied.

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shutterstock_46993942-300x200According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) former advisor John Schmidt (Schmidt), formerly associated with Wells Fargo Advisors Financial Network, LLC (Wells Fargo) in Dayton, Ohio has been accused by the Securities and Exchange Commission (SEC) of misappropriating over $1.16 million from at least seven clients.

In September 2018 the SEC filed a complaint alleging that for the past 35 years Schmidt has been a registered representative in the brokerage industry.  The SEC found that from at least 2003 through 2017, Schmidt betrayed his customers’ trust by perpetrating a classic fraudulent scheme, acting without customer authorization, and repeatedly selling securities belonging to some of his brokerage customers and secretly transferring the sale proceeds to cover shortfalls in the accounts of other customers.   The SEC alleged that Schmidt misappropriated over $1.16 million from accounts belonging to seven customers and transferred that cash to at least ten other customers whose accounts were experiencing shortfalls.  In addition, the commission found that rather than tell those customers the truth about their dwindling funds, Schmidt sent them fake account statements and falsely assured the customers that their investment returns could fund their withdrawals without jeopardizing their principal. Most of Schmidt’s customers were elderly retirees with little to no financial expertise and several of Schmidt’s victims were suffering from Alzheimer’s disease or other forms of dementia.  The SEC claimed that at least five of Schmidt’s victims passed away during the course of his fraud. Further, Schmidt’s allegedly profited from the scheme and received over $230,000 in commissions from customers who were either the source of, or recipient of, misappropriated funds.

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shutterstock_12144202-300x200The securities attorneys at Gana Weinstein LLP have been investigating Wells Fargo Clearing Services, LLC (Wells Fargo) broker Bryan Musso (Musso). According to BrokerCheck Records kept by the Financial Industry Regulatory Authority (FINRA), Musso has been subject to six customer disputes, one of which is still pending. The majority of these disputes concern unsuitable investment recommendations in retirement plans and in oil and gas securities. The law offices of Gana Weinstein LLP continue to report on investor related losses and potential legal remedies due to recommendations to investor in oil and gas and commodities related investments.

Most recently, in December 2017, Musso was subject to a customer dispute in which a customer alleged that Musso placed the customer in unsuitable oil and gas securities. This dispute is currently still pending.

In May 2011, a customer alleged that Musso made poor, unsuitable retirement plan recommendations and placed the customer into unsuitable investments. The case was settled at $445,220.

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shutterstock_62862913-259x300The investment fraud attorneys at Gana Weinstein LLP are currently investigating Wells Fargo Clearing Services, LLC (Wells Fargo) broker Peter Malis (Malis). According to BrokerCheck Records kept by the Financial Industry Regulatory Authority (FINRA). According to BrokerCheck Records, Malis has been subject to five customer disputes, the majority concerning unsuitable investments in mutual funds, municipal bonds, and limited partnerships.

Most recently, in December 2017, a customer alleged that from February 2006 to December 2016, Malis placed the customer in unsuitable investments and executed trades in the account without the customer’s consent.

In September 2016, a customer alleged that from March 2002 to January 2016, Malis placed the customer in unsuitable investments and engaged in unauthorized trades and churning of the account. The case was settled at $1,100,000.

In May 1995, a customer alleged that Malis placed the customer in unsuitable mutual funds and limited partnerships. The case was settled at $12,500.

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shutterstock_95416924-300x225The securities attorneys at Gana Weinstein LLP are currently investigating previously registered broker David Manor (Manor). According to BrokerCheck Records kept by the Financial Industry Regulatory Authority (FINRA), Manor has been subject to two customer disputes concerning unsuitable investment recommendations and false representations of investments. One of these disputes is currently still pending. In addition, Manor has been subject to resignation from a previous employer.

Most recently, in April 2018, a customer alleged that in 2017, Manor recommended unsuitable investments to the customer. The customer requested $224,837.25 in damages. This dispute is currently still pending.

In January 2016, a customer alleged that Manor falsely represented investments to the customer by failing to disclose the surrender penalty to the investment. The customer further alleged that the investment was unsuitable to her financial status and needs, being that the funds were her only source of income. The customer requested $30,000 in damages.