Articles Tagged with fund

AdobeStock_41845221-300x212If you lost money because of a recommendation by Horter Investment Management, please call our Chicago-based law firm today. We are securities attorneys who help clients bring claims against firms like Horter Investment Management. Horter sold shares of LJMIX as part of its “sleeves” investment philosophy. Notwithstanding the name of the fund, LJMIX was not focused on capital preservation and left investors exposed to an unacceptably high risk of catastrophic losses. This occurred on February 5th, 2018, when the S&P 500 fell 4.6% and by the close of trading on February 6th, LJMIX had lost 88%. It was an inaptly named Fund, as it actually pursued the opposite of a capital preservations and growth strategy, and was implementing an options trading strategy with unlimited downside (in other words, no preservation) and limited upside (no growth). A professional investment advisor like Horter must understand the options strategy employed by a fund like LJMIX and not simply relied on the name of the fund when it selected it as part of the firm’s “sleeves” strategy.

Hundreds of clients of the Cincinnati, Ohio-based Registered Investment Advisor (RIA) had LJMIX in their portfolios. This investment was unsuitable for many clients due to its speculative nature, which included the risk of total loss. As a fiduciary investment advisor, Horter had a legal obligation to understand LJMIX prior to selecting it as part of its “sleeves” strategy.

This is not the first time Horter has been in hot water in connection with a mutual fund. According to an Order Instituting an Administrative Cease and Desist against Horter brought by the Securities and Exchange Commission (SEC) last year, Horter Investment Management was accused of making misstatements to clients concerning F-Squared Investments, Inc. (F-Squared), which materially inflated performance track record for its AlphaSector strategy. These alleged misstatements were made between January 2012 and October 2013, and resulted in a $250,000 fine to Horter.

Accelerated Capital Group entered into a Disciplinary Proceeding with the Financial Industry Regulatory Authority (FINRA). According to the Proceeding, Accelerated allegedly failed to establish and maintain a supervisory system, including written supervisory procedures (WSPs), reasonably designed to achieve compliance with federal securities laws and FINRA rules. “The firm failed to reasonably supervise trading activity to ensure that all securities transactions were suitable, not excessive, and properly authorized by the firm’s customers; failed to monitor mutual fund switches, exchanges and sales for suitability; failed to ensure that its registered representatives informed customers of potential breakpoints when purchasing mutual fund products; and, failed to reasonably identify or respond to red flags of broker misconduct.” These are all against securities laws.

Do you or someone you know have claims against former Fifth Third broker Ankur Bhatia? If so, the attorneys at Stoltmann Law Offices may be able to help you. Stoltmann Law Offices is investigating Bhatia, who allegedly misrepresented material facts, executed unauthorized trades, and issued unauthorized credit cards. On another occasion, Mr. Bhatia recommended an unsuitable mutual fund investment, and misrepresented material facts related to a mutual fund product in September 2007. These are all against securities laws and internal firm rules. According to public, online records with the Financial Industry Regulatory Authority (FINRA), Ankur Bhatia was previously registered with Fifth Third Securities in Lake Forest, Illinois from April 2006 until February 2016. He has three customer disputes against him, two of which are currently pending. He is not currently registered within the industry as a broker.

AdobeStock_82110313-1-300x125Stoltmann Law Offices is investigating James Plaster, an Alabama-based Ameriprise Financial Services broker. He allegedly failed to manage a portfolio with reasonable care and to perform his job properly. He also made unsuitable mutual fund investment recommendations. These are all against securities laws. His firm, Ameriprise, can be sued in the Financial Industry Regulatory Authority (FINRA0 arbitration forum on a contingency fee basis. Please call our Chicago-based law offices today at 312-332-4200 to find out how. Plaster was registered with Merrill Lynch in Tuscaloosa, Alabama from September 1993 until April 2017 and Ameriprise in Tuscaloosa since April 2017. He has two customer disputes against him, one of which is currently pending. Please call our securities law firm today at 312-332-4200 to find out how to bring a claim against Ameriprise on a contingency fee basis.

Stoltmann Law Offices is investigating Interactive Brokers LLC. An arbitration panel recently found the discount brokerage firm liable for selling securities from client accounts to pay margin debt, resulting in large losses. The panel ordered the firm to pay $667,000 to a hedge fund affected by the losses. The hedge fund, Glen Lyon Long Term Options LP, sought between $1 million and $3 million. According to the Financial Industry Regulatory Authority (FINRA), the brokerage firm used a flawed “auto-liquidation” system. Instead of requiring the value of securities in margin accounts to stay above a certain level before paying, Interactive Brokers requires customers to let the firm automatically liquidate securities to bridge the gap. Glen Lyon claimed that their system backfired more than two times in 2011, and their margin account deficit quickly went up to $200,000. If you invested money with Interactive Brokers, you may be able to sue them for investment losses in the FINRA arbitration forum. Our securities lawyers can help you go over your options by calling 312–332–4200.

The Federal Bureau of Investigation (FBI), Internal Revenue Service (IRS) and the U.S. Attorney’s Office in the Western District of North Carolina put almost a dozen ponzi scheme masterminds behind bars. Keith Franklin Simmons, the head of the scheme, was sentenced to 40 years in prison late last year, and recently, Jonathan D. Davey, another fraudster was sentenced to more than 21 years. Almost $40 million was taken from investors in the fraud.

Simmons began the fraud in 2007 when he formed “Black Diamond,” and touted it as a legitimate hedge fund involved in foreign currency trading. He told investors Black Diamond had safeguards in place, was independently audited, and had consistent high rates of return. None of this was true. He also recruited individuals to serve as regional managers of the hedge fund, and stole money from these individuals. Many of them sold annuity products to the elderly. They were promised financial compensation for selling Black Diamond and for bringing on new investors in the scam. None of the money was actually invested.

Davey, a certified public accountant and investment manager in Ohio, oversaw the various hedge fund managers. He controlled the funds for the scheme and posted on a website that claimed false returns. All of the accounts totaled one million, when the website claimed that it was over $120 million. Davey and Simmons both spent the money on personal items and lavish luxuries. By December 2009, the FBI placed Simmons in custody. If you invested money with either man or with Black Diamond, you may be able to recover your investment losses. Please call our Chicago-based securities law firm at 312–332–4200 to speak to one of our securities attorneys.

Stoltmann Law Offices is interested in speaking to those investors who may have invested with Merrill Lynch in the fund MLCXX6LSER Index (MLC Index). Craig Kinard, a Merrill Lynch adviser, was accused of making MLC Index recommendations and sales. MLC Index is allegedly one of the most complex investment products that could be sold to a retail investor, and, therefore, is suitable to few investors. The Index involved extreme leverage, commodities, derivatives, options and swaps risk. The MLC Index proved to be too great of a challenge for brokers and customers to understand, and many customers lost money. Also, the Index was subject to enormous costs and fees. Merrill Lynch advertised the Index as having “Low Volatility” and producing “Consistent Returns” to investors and that it provided back testing data showing that the fund would have an annualized return of 6.77% and that from 2002 until 2011 the fund did not have a single negative return year. Merrill Lynch failed to properly explain and disclose the main risks to arbitrage funds in that the hedging strategy, or the correlation assumptions, will not prove accurate. The Fund was volatile. If you lost money with the MLC Fund and Merrill Lynch, please call our securities law firm today to speak to an attorney about your options. The call is free with no obligation. We may be able to help you recover your losses.

Stoltmann Law Offices is investigating Kevin Dunnigan, a broker with Investment Centers of America. Dunnigan has been accused of making unsuitable investment recommendations, misrepresenting material facts related to a mutual fund investments, failed to disclose risks and commissions, acted negligently, omitted material facts and was censured and fined for his actions. These are all against securities rules and regulations. Mr. Dunnigan was registered with Integrated Resources Equity Corp from May 1984 until November 1989 and Royal Alliance Associates in New York, New York from November 1989 until December 1990. He is currently registered with Investment Centers of America in Loveland, Colorado and has been since December 1986. He has six customer disputes against him. Please call our securities law firm for a free consultation with an attorney if you lost money with Kevin Dunnigan. There is no obligation and we may be able to help you bring a claim against his firm, Investment Centers of America.

According to a recent Letter of Acceptance, Waiver and Consent (AWC) with the Financial Industry Regulatory Authority (FINRA), David Altwerger was accused of making 10 electronic fund transfers from his personal bank account to his personal brokerage account knowing that he had insufficient funds to cover the transfers. This is against securities rules and regulations, and Altwerger was terminated from his brokerage firm, Morgan Stanley, because of it. FINRA suspended him for three months and fined him $5,000. Altwereger was registered with Pruco Securities in Troy, Michigan from May 2008 until December 2009 and Morgan Stanley in Troy from January 2010 until January 2016. He is currently registered with Waddell & Reed in Birmingham, Michigan and has been since January 2016.

Both Morgan Stanley and Edward Jones are in hot water because of mismanagement and overcharging of fees regarding the companies’ 401(k) plans. Morgan Stanley was accused of mismanaging the firm’s 401(k) retirement plan and costing 60,000 employees hundreds of millions of dollars by picking inappropriate and high-priced investments. This was done in order for the firm to profit from those sales. A lawsuit was filed against the firm last month and included a class action status for all who were enrolled in the $8 million plan from March 2010 until February 2016. The lawsuit complaint argued that Morgan Stanley did not act in the best interest of its customers by placing them in 401(k) plans that had high fees.

Edward Jones is also facing a lawsuit from an employee of the bank who alleges that the company’s 401(k) plan has caused employees to pay high fees for investment management and record-keeping services that supposedly cost them millions in retirement savings. Allegedly, from August 19, 2010 until the present, customers potentially lost $8 million because of the unreasonable fees paid. It is also alleged that the plan offered high-cost mutual fund share classes when lower-cost alternatives were available for the same funds. The participants in the 401(k) would have saved tens of millions more dollars if assets were invested in collective investment trust funds and separately managed accounts. Edward Jones allegedly did not offer its customers the options of purchasing lower-cost index funds and stable value funds. The funds they offered underperformed and more than $100 million was lost as a result.

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