Articles Tagged with IRA

According to a recent Letter of Acceptance, Waiver and Consent (AWC) with the Financial Industry Regulatory Authority (FINRA), Cyrus Lamont Hancock was accused of converting two checks totaling $11,000 from two customers in violation of securities laws. According to the AWC, in April 2014, a customer wrote Hancock a $5,500 check and gave it to him to purchase mutual funds in an IRA account held directly with a mutual fund sponsor. In August 2014, another customer wrote a $5,500 check and gave it to Hancock in order to be made payable to a 2013 IRA contribution. Hancock then deposited the checks into his personal account and used the funds to pay his own personal expenses. For this he was barred from the industry by FINRA.

Hancock was registered with Waddell & Reed, Equity Services, Investors Capital Corp in Atlanta, Georgia from October 2006 until March 2007, JW Cole Financial Inc., Dempsey Lord Smith, Investors Capital Corp in Atlanta, Georgia from January 2013 until May 2015 and Ele Wealth Advisors. He has one criminal final disposition against him, is not licensed and has been barred from the industry. If you lost money with Cyrus Hancock, and would like to find out how to sue Investor Capital Corp, please call our securities law firm in Chicago to speak to an attorney. The call is free.

Stoltmann Law Offices is investigating Dennis Hayes, a broker with Newbridge Securities Corporation. Hayes allegedly recommended unsuitable transactions. The claimant alleged approximately $750,000 in damages. According to her statement of claim, the client divorced her husband in 2012, after which she had $1,500,000 in assets of which $500,000 was non-qualified money and about $1 million was qualified IRA funds. The client explained to Hayes that she wanted to protect her assets while having returns to meet her immediate income needs. After transferring her funds, Hayes solicited her to invest in a gold fund called USA Gold. Hayes recommended $300,000 in USA Gold through a self-directed IRA account. USA Gold appears to be an unregistered securities offering and most likely an investment scam. Newbridge Securities failed to properly investigate Hayes for his involvement in the unregistered offering. Hayes continues to work at Newbridge, therefore, putting other clients at risk. The claimant also allegedly complained to Gene Robert Abrams, Newbridge’s General Counsel and Co-Chief Compliance Officer, that Hayes was involved in private securities transactions. This is despite multiple sources claiming and proving that Hayes was, and most likely continues to be, involved in fraudulent private securities transactions.

Other risky assets the claimant was invested in included, non-traded real estate investment trusts (REITs) such as American Realty Capital Hospitality REIT, Carter Validus Mission Critical REIT, Griffen Capital Essential Asset REIT, and Business Development Corporation of America, as well as Shopoff Land Fund IV and RCS Capital Corporation (RCAP). All of these securities and REITs are risky, unsuitable investments, that were not along the lines of the claimant’s wishes and investment objectives. A broker must take into account his client’s age, net worth, risk objectives, investment savvy and portfolio before recommending an investment, and, if he does not, his firm can be liable for investment losses by being sued in the FINRA arbitration forum on a contingency fee basis.

According to his BrokerCheck report, Hayes was registered with AAL Capital Management Corp, Veravest Investments, Equity Services, MML Investors Services, Capital Investment Group, NFP Securities and is still registered with Newbridge in Boca Raton, Florida and has been since February 2010. He has two customer disputes against him, one of which is currently pending. Please call us today if you have investments with Dennis Hayes. We may be able to help you recover your investment losses. The call is free with no obligation.

According to a press release last week, a North Dakota farmer brought a claim against National Securities Corporation, alleging that brokers at the firm engaged in churning in his account, recommended unsuitable high risk securities and used boiler room tactics to convince him to invest in the unsuitable securities. Boiler room tactics can be classified by brokers selling stock (typically micro-cap stock) and using false or misleading statements to sell it, because of their overwhelming desire to sell the stock and claim large commissions for themselves. Often, the stocks that are touted trade on the Pink Sheets (or the system on which companies trade do not need to meet minimum requirements or file with the SEC), because this exchange requires very little in terms of disclosure and regulation.

According to the press release, brokers at National Securities Corp recommended the client purchase a small amount of stock in an agricultural security. Subsequently, the brokers then recommended the client invest most of the remaining balance of his account in a single high-risk security called the First Hand Technology Value. This concentrated approximately half of the client’s net worth into a single security. A broker must take into account the client’s age, net worth, investment objectives and portfolio sophistication before recommending or selling a security. If he does not, his brokerage firm may be responsible for investment losses because it is the firm’s responsibility to reasonably supervise their brokers.

Up until that point, the client’s investment experience had been limited to self-directed trades in a relatively small online account, and conservative trades in his IRA. According to the allegations in a claim filed with the Financial Industry Regulatory Authority (FINRA), the brokers failed to discuss with the customer his investment experience, and also failed to discuss the risky and speculative nature of the securities they were purchasing for them. The brokers continued to aggressively buy and sell stocks in the customer’s account, sometimes using margin debt. The client was not aware what margin was, nor was he aware that he was accumulating significant interest obligations. When the client attempted to close his account in 2014, the brokers met with the client in person, convincing him to leave the account in their hands and convincing him to give them more money. The customer then gave them the rest of his savings, which the brokers subsequently put half into a single illiquid, high-fee investment. These tactics resulted in the client losing more than half a million dollars, not including his losses sustained in a private real estate investment trust (REIT).

The Financial Industry Regulatory Authority (FINRA) awarded a former Wells Fargo client, Mark Schroeder, more than $400,000 because the bank negligently permitted the client’s ex-wife to empty his IRA over a period of 10 years. A panel of three arbitrators forced Wells Fargo to pay $106,000 for attorneys fees and $317,000 for compensatory damages. Allegedly, in August 2001, Schroeder’s then wife changed the address on his IRA to a P.O. Box she controlled. The wife was not listed on his account. The first withdrawal she made was $30,000 and this continued for ten years. Wells Fargo neglected to contact Schroeder about the change of address and the ex-wife’s withdrawals. No one else but Schroeder himself was authorized to do anything on the account when it was opened.

Recently, UBS stripped the majority of the coal companies it covers, including Walter Energy (WLT), and Alpha Natural Resources (ANR) of their Buy ratings. Other impacted stocks include Consol Energy (CNX), Peabody Energy (BTU) and Arch Coal (ACI). The downgrade comes at a time when coal companies are cutting capital spending to maintenance levels and are primarily focused on preserving/enhancing liquidity. Investors are not encouraged to buy coal-levered names such as Walter Energy, Alpha Natural Resources or Arch Coal because of these companies, Walter Energy and Alpha Natural Resources especially, taking the biggest hits. Walter Energy filed for bankruptcy on July 15th, 2015. Shares of Consol Energy and Walter Energy have plunged significantly since then. Investments like coal, and oil and gas, are particularly risky for investors, with the prices of these fuels declining at a rapid rate.

Paul W. Murans, a current broker with UBS in Indianapolis, Indiana, allegedly recommended and sold Walter Energy products to at least one client in May and June of 2012 in an IRA account. The client suffered a total loss on the investment with the coal product. Murans allegedly told the client that the account was considered to be a growth account and that there was no possibility of taking a loss from it. The client stated that she wanted steady growth, income and safety. The investment was not suitable for the client. Murans was registered with UBS Painewebber in Weehawken, New Jersey from October 2000 until April 2003 and is currently registered with UBS in Indianapolis and has been since March 2011.

If you were recommended these investments by Murans, another UBS broker, or any other broker, and suffered losses, please call our Chicago-based securities law firm today to speak to an attorney. Firms such as UBS can be sued in the Financial Industry Regulatory Authority (FINRA) for allowing their brokers to recommend and sell securities such as coal investments with Walter Energy. A broker has a duty to recommend only those investments that are suitable for investors and must take into account an investor’s age, net worth, portfolio objectives and investment sophistication when doing so.

The Financial Industry Regulatory Authority (FINRA) recently barred three advisors from the industry for allegedly stealing from clients. The first broker was Nahuel Rodriguez, a former advisor with Primerica Financial Services, who allegedly stole $26,144 from investors, three of whom were self-employed housekeepers. He allegedly told one of the customers to liquidate her IRA by falsely telling her that he would transfer money to a new account that would produce greater returns. He also impersonated one of the customers when he directed his firm to liquidate the customer’s joint account at the firm. Once the firm had, he told the joint account customers that the firm mistakenly had wired money from his account into theirs. It was then that he took the money for himself.

The second broker was Lori Hermanson, who worked as a treasurer for a non-profit and allegedly stole $26,000 between January 2012 and November 2015. Hermanson was a contract broker with Transamerica Financial Advisors at the time.

The third broker was William Roldan, a JP Morgan Chase bank employee, who stole $26,000 from clients via ATM withdrawals between July and November of 2015. Roldan was immediately terminated. If you lost money with any of the above brokers, please call our securities law firm in Chicago to speak to an attorney about your options of recovering. The call is free.

Stoltmann Law Offices is interested in speaking to any investors who may have invested with Byron A. Echeverria, a former broker with Morgan Stanley from 2011 until 2015. According to his Financial Industry Regulatory Authority (FINRA) Letter of Acceptance, Waiver and Consent (AWC), Echeverria allegedly falsified documents related to customer accounts by re-using original customer-signed signature pages from expired forms and altered tax withholding amounts on forms. Between September 2010 and May 2015, Echeverria falsified 10 documents related to 10 customer accounts, including disclosure forms, transfer forms and IRA distribution forms. He re-used original customer signatures and recycled customer-signed signature pages from expired forms, and altered tax withholding amounts to expedite transactions. These are all against securities rules and regulations. For this, he was suspended from the industry for three months. He was unable to pay a monetary amount, so no fines were imposed upon him.

According to his online FINRA BrokerCheck report, Byron A. Echeverria was registered with APS Financial Corporation in Austin, Texas from August 2005 until August 2006, Stanford Group Company in Houston, Texas from March 2007 until June 2007, UBS Financial in Houston from August 2007 until May 2011 and Morgan Stanley in Houston from May 2011 until May 2015. He is currently registered with Slavic Investment Corp in Boca Raton, Florida and has been since November 2015. If you are interested in speaking to an attorney for free about your options of suing Morgan Stanley for losses with Echeverria, please call our law offices in Chicago today.

Stoltmann Law Offices is investigating Timothy Sullivan, a former registered representative with SII Investments. Sullivan has been accused of not informing a customer of a tax consequence related to the liquidation of her variable annuity, which caused more than $46,000 in damages. A separate customer also accused Sullivan of failing to adjust his/her principal due to the decreasing value of his/her IRA account, and another customer alleged that Sullivan executed three unauthorized stock purchases. He was also accused of making unsuitable recommendations, acting negligently, executing unauthorized trades, breaching fiduciary duty and misrepresenting material facts.

Sullivan was registered with Alamo Capital in Walnut Creek, California from December 1997 until January 2000, FSC Securities in Danville, California from January 2000 until July 2006 and Securities Service Network in Danville from July 2006 until September 2008. He is currently registered with SII Investments in Appleton, Wisconsin and has been since September 2008. He has nine customer disputes against him, one of which is currently pending, according to his Financial Industry Regulatory Authority (FINRA) BrokerCheck report. He also has two criminal dispositions against him. If you know anyone who invested and lost money with Timothy Sullivan, or if you did yourself, please call our Chicago-based securities law firm to find out how you can sue his brokerage firm in the arbitration forum. The call is free.

The Securities and Exchange Commission (SEC) is investigating Equity Trust Co., an Ohio based IRA provider. It is alleged that Equity Trust was ignoring red flags for accounts with investments that turned out to be fraudulent. This comes after Ephron Taylor, the mastermind of a ponzi sheme, and Randy Poulson, indicted in federal court for alleged fraud in New Jersey, came under investigation. Taylor targeted churchgoers in a ponzi scheme and the SEC alleges that both men cheated 100 investors out of $5 million through Equity Trust accounts. The SEC also alleged that Equity Trust did not take any action to remedy the fraud that was cheating investors out of millions. Equity Trust representatives also participated in events hosted by Taylor and Poulson and joined them in encouraging investors to participate in the scheme. They also allegedly processed investments in notes offered by Taylor and Poulson. If you invested in Equity Trust, please call our Chicago-based securities law office for a free consultation with an attorney. We sue firms such as Equity Trust for financial losses suffered by investors. Our number is 312-332-4200. We take cases on a contingency fee basis only. There is no obligation.

A former client of Joan Norton, a financial advisor of Ausdal Financial Partners, won a $1.2 million arbitration award against her. The Financial Industry Regulatory Authority (FINRA) awarded the money to her after siding with her, claiming Norton breached fiduciary duty and made unsuitable investment recommendations. Norton advised Cindy-Marie Rogers to roll over a lump-sum pension payout, plus put money into an IRA and buy a variable annuity. Rogers took an early retirement because she was advised by Norton she could do so. After this, she got hit with a steep tax bill. Joan Norton and her firm, Ausdal Partners were ordered to pay $1.24 million in damages plus interest, and additional costs of $10,000. Please call our law firm if you would like to sue Joan Norton or her former firm, Ausdal Partners. 312-332-4200.

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