Articles Tagged with 2013

Stoltmann Law Offices is investigating Joseph Michael Araiz, former Chief Executive Officer of formerly named Ecapitalist Financial Services, now named Further Lane Securities. In February 2008, Araiz became Further Lane’s Chief Compliance Officer in addition to being its CEO. Araiz received a Wells Notice on March 17, 2014, stating that it was recommending enforcement action against Araiz for failing to disclose material facts to underwriters of certain corporate bonds in connection with an investment adviser’s purchase of those bonds in secondary offerings between 2009 and 2012. Araiz allegedly violated securities laws which included acting as an adviser to an investment fund and causing the fund to acquire a promissory note from an entity owned by Araiz without disclosing to investors that the fund might acquire related-party promissory notes or that it might otherwise materially deviate from its fund-of-funds investment strategy. It also alleged that he caused the fund to invest in a second promissory note with an unaffiliated entity without written disclosure to the investors. He was suspended for this from November 11 2013, through November 10, 2014. He was terminated from the firm by the Securities and Exchange Commission (SEC) on November 14, 2013.

Araiz was registered with Cowen & Co., Gruntal & Co., MJ Whitman & Co., Ladenburg, Thalmann & Co., Imperial Capital LLC, The Concord Equity Group and Further Lane Securities in New York, New York from March 2002 until November 2013. He has one customer dispute against him and two regulatory matters, one of which is currently pending. He is not licensed within the industry, according to his online Financial Industry Regulatory Authority (FINRA) public BrokerCheck report. If you feel like you may have a claim against Mr. Araiz, please call our securities law firm today to speak to an attorney for free. We may be able to help you recover your investment losses. 312-332-4200.

A U.S. Court of Appeals denied Raymond Lucia Sr.’s petition to review and vacate an SEC decision. Lucia was a former investment adviser and talk show radio host who was barred from the industry last year by the SEC. The court stated “In view of the Securities and Exchange Commission’s findings that Mr. Lucia repeatedly and recklessly engaged in egregious conduct without regard to his fiduciary duty to his clients, petitioners fail to show that the commission’s sanction was unwarranted as a matter of policy without justification in fact, or that it failed to consider adequately his evidence of mitigation. According, we deny the petition for review.” His failure to win an appeal is a setback for other advisors who have been challenging the SEC’s use of administrative law judges to handle disciplinary cases. Mr. Lucia wants to have cases such as these heard in federal court, where they claim they have more rights than in administrative proceedings. Last September, the SEC voted to uphold a decision by an in-house judge from 2013 to punish Lucia for misleading investors about the efficacy of his “buckets of money” approach to building retirement assets. The SEC said Mr. Lucia used inflation rates to “back-test” the strategy that did not reflect historical rates of inflation for the time periods to which he referred. At the time, Mr. Lucia was barred from the industry and he and his firm were ordered to pay a total of $300,000 in fines.

Have you lost money with either Daniel Dettlaff or Christopher Wacker of Park Avenue Securities in Brookfield, Wisconsin? If so, the attorneys at Stoltmann Law Offices are interested in speaking with you about your options of recovering your investment losses. We are securities attorneys who sue firms such as Park Avenue Securities in the Financial Industry Regulatory Authority (FINRA) arbitration forum on a contingency fee basis to recover money for investors. Please call us today for a free consultation. We may be able to bring a claim against the firm on your behalf.

FINRA alleged that Wacker lied about speaking to a client who wanted to sell securities. He did not, in fact, speak to the client, he only spoke to an unlicensed administrative assistant regarding the fabricated orders. This same assistant was alleged to have stolen $255,000 from two Park Avenue Securities customers by making unauthorized transfers from their accounts. These customers were serviced by Daniel Dettlaff. The misconduct occurred between 2010 and 2013. Wacker agreed to settle the allegations by paying a $5,000 fine and taking a two-month suspension.

According to his online BrokerCheck report, Dettlaff was registered with Northwestern Mutual Investment Services in Milwaukee, Wisconsin from October 1990 until January 1994, Robert W. Baird & Co. in Milwaukee from July 1992 until January 1994 and Guardian Investor Services in New York, New York from January 1994 until May 1999. He is currently registered with Park Avenue Securities in Brookfield, Wisconsin and has been since May 1999. He has one investigation against him.

The Financial Industry Regulatory Authority (FINRA) announced today that it has fined Oppenheimer & Co. Inc. $2.5 million and ordered the firm to pay restitution of more than $716,000 to affected customers for selling leveraged, inverse and inverse-leveraged exchange-traded funds (non-traditional ETFs) to retail customers without reasonable supervision, and for recommending non-traditional ETFs that were not suitable. In August 2009, Oppenheimer instituted polices prohibiting its representatives from soliciting retail customers to purchase non-traditional ETFs, and also prohibited them from executing unsolicited non-traditional ETF purchases for retail customers, unless the customers met certain criteria, such as the customer had liquid assets in excess of $500,000. Oppenheimer, allegedly, failed to execute the stated criteria. During the time period of August 2009 until September 30, 2013, more than 760 Oppenheimer representatives executed more than 30,000 non-traditional ETF transactions totaling approximately $1.7 billion for customers.

FINRA found that Oppenheimer failed to conduct adequate due diligence regarding the risks and features of non-traditional ETFs, and, as a result, did not have a reasonable basis to recommend these ETFs to retail customers. Also, Oppenheimer’s representatives solicited and effected non-traditional ETF purchases that were unsuitable for specific customers. For example:

An 89-year conservative customer with annual income of $50,000 held 96 solicited non-traditional ETF positions for an average of 32 days (and for up to 470 days) resulting in a net loss of $51,847.

Stoltmann Law Offices is investigating James Noto, a registered representative with Summit Brokerage Services. Noto was the subject of a regulatory event and seven customer disputes. He was fined by Florida’s Department of Financial Services in 2013 after allegedly engaging in the insurance business without proper licensing. If you have lost money with Noto, please call our offices in Chicago at 312-332-4200 to speak to an attorney. The call is free with no obligation.

Noto was registered with Cigna Securities in Radnor, Pennsylvania from September 1982 until April 1993, Merrill Lynch in New York, New York from March 1993 until January 1998, Vanguard Capital in Del Mar, California from January 1998 until September 1998 and Raymond James in St. Petersburg, Florida from October 1998 until February 2005. He is currently registered with Summit Brokerage Services in Trinity, Florida and has been since March 2005. He has seven customer disputes against him, one of which is currently pending.

Stoltmann Law Offices is investigating former WRP broker, John P. Corsi of Parma, Ohio. In a complaint filed in Cuyahoga county court, investors claim that Corsi sold them $750,000 in promissory notes issued by a debt-collection firm named Argent of Nevada, Inc. Allegedly, at least 15 other WRP clients were also sold these notes between 2009 and 2013. The Financial Industry Regulatory Authority is investigating the claims, and Corsi was terminated by WRP Investments for cause in December 2015. According to his FINRA BrokerCheck report, Corsi was registered with WRP Investments in Parma, Ohio from January 2005 until September 2014, when WRP was purchased by Sterne Agee Financial Services, where he maintained his affiliation until he was fired for cause in December 2015. He has one customer dispute against him, which is currently pending. He is not licensed within the industry. If you made investments with Corsi, you may be able to recover them in the FINRA arbitration forum by suing his former firm, WRP Investments. Please call our Chicago-based law firm today for a free consultation.

Last week, RBC Capital Markets wealth management division settled with the Financial Industry Regulatory Authority (FINRA) over an investigation the agency said revealed dozens of instances where the investment bank failed to update forms that disclose whether representatives have outstanding tax liens and civil judgments. Allegedly, the firm failed to update its reps Forms U4 in 41 instances over a two and a half year period beginning January 1, 2013. For this, RBC was censured and fined $300,000. Also, during the relevant period, RBC failed to establish and maintain a supervisory system and written supervisory procedures reasonably designed to ensure that it disclosed reportable unsatisfied judgments and liens, according to FINRA. The firm failed to consistently conduct a sufficient inquiry to determine if the underlying events should have been reported. RBC must certify its compliance procedures within 30 days to FINRA. Last year, the firm agreed to pay $1.4 million over supervisory failures in the sale of complex structured securities products that resulted in $1.1 million worth of investor losses spread across 218 customer accounts. It also settled with FINRA over allegations it failed to accurately report billions of order events last year.

Citigroup was recently sued for fraud by investors and creditors of a bankrupt Mexican oil services firm over claims that they were harmed by a loan scheme. The same scheme caused the bank to cut 2013 profit by $235 million and fire at least 12 people. The bank’s loans allegedly led to the collapse of the Mexican firm, Oceanografia SA, and caused Rabobank Groep, a Dutch lender, to lose at least $1.1 billion, according to a lawsuit filed Friday in Florida federal court. Rabobank and other investors separately filed a negligence suit in Delaware state court against auditor KMPG LLP.

Citigroup’s Mexican subsidiary, Banamex, made short-term loans to Oceanografia, which worked for state-run Petroleos Mexicanos, or Pemex. Pemex then repaid the bank for the loans. According to Citigroup Chief Executive Officer Michael Corbat, $400 million of accounts receivable from Oceanografia were fraudulent. He is now working with Mexican authorities to find out who perpetrated the crime. Many investors claim that the bank conspired with Oceanografia to accept falsified work estimates, even when the firm became increasingly dependent on cash advances to survive. Then Pemex repaid the bank with millions of dollars in interest. Mexican authorities placed Oceanografia in bankruptcy and later charged several Citigroup employees with crimes, according to a complaint, which claims that the bank violated the Racketeer Influenced and Corrupt Organization Act and engaged in fraud while breaching its fiduciary duty. It is seeking compensatory and punitive damages.

Allegedly, Oceanografia’s cash advance requests were subject to a two-step approval process by Citigroup to verify that documents submitted accurately reflected the terms of its contracts with Pemez. In at least 66 cash requests, Citigroup did not satisfy either step, failing to detect falsified documents, according to the complaint. Subsequently, Citigroup increased the cash flow to the firm to try to extract money from Pemex.

The Securities and Exchange Commission (SEC) yesterday charged Goldman Sachs $15 million to settle charges that its securities lending practices violated federal regulations. According to the SEC Order, customers frequently ask broker-dealers such as Goldman to locate stock in order to short sell it. Granting that, means that the firm has borrowed, arranged to borrow, or reasonably believes it could borrow the security in order to complete the short sale. The SEC found that Goldman violated securities laws by not providing locates to customers where it had not performed an adequate review of the securities to be located. They also were inaccurately recorded in a firm log. Andrew J. Ceresney, Director of the SEC’s Enforcement Division stated, “The requirement that firms locate securities before effecting short sales is an important safeguard against illegal short selling. Goldman Sachs failed to meet its obligations by allowing customers to engage in short selling without determining whether the securities could reasonably be borrowed at settlement.” The SEC questioned the firm’s lending practices during an investigation in 2013. If you suffered losses with Goldman Sachs, you may be able to recover your losses. Please call our Chicago-based securities law offices to speak to an attorney for free about your options.

Stoltmann Law Offices continues to investigate claims against Tom Buck, a former registered broker with Merrill Lynch in Indianapolis, Indiana. Since March of last year, Buck has 27 customer complaints against him, and according to the Indiana Business Journal on Friday, has cost his former firm, Merrill Lynch, more than $4.1 million in settlements to date. He has since been fired and was barred from the industry permanently by the Financial Industry Regulatory Authority (FINRA) in July. FINRA claimed that Buck “willfully committed fraud” by placing clients in commission accounts when they could have done better in fee-based advisory accounts. He was officially charged with misrepresentation of commissions, unsuitable investments and excessive trading. Many of the customer complaints settled for the full amount requested, with the largest being for $719,000. Two of the complaints are still pending, with the most recent being filed on November 17th. Before that, he was heralded by “Barron’s” as Merrill Lynch’s top broker in Indiana and had been named that every year from 2009 until 2013.

According to his online FINRA BrokerCheck report, Buck was registered with Merrill Lynch in Indianapolis, Indiana from December 1981 until April 2015 and RBC Capital Markets in Indianapolis from April 2015 until July 2015. He is not currently registered with any firm or licensed within the industry. FINRA has permanently barred him from the industry. Please call our securities law offices in Chicago if you or someone you know lost money with Thomas Buck. Merrill Lynch can be held responsible for your investment losses because they had a duty to reasonably supervise him while he was employed there. We sue firms in the FINRA arbitration process. The call is free with no obligation. We take cases on a contingency fee basis only.

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