Articles Tagged with Morgan Stanely

Chicago-based Stoltmann Law Offices is representing investors who’ve suffered losses from dealing with broker-advisors who have run Ponzi schemes right under their big-bank firm’s nose. Unscrupulous financial advisors have been known to steal clients’ money to pay for their lifestyle. As they are pocketing investors’ funds, they are often pitching  investments like Ponzi schemes, which are fake and fraudulent investment schemes fueled by money flowing in from new investors.

Shawn E. Good, 55, from Wilmington, North Carolina, a former Morgan Stanley advisor, had “clients send funds to his personal bank account to supposedly make low-risk investments in real-estate development projects,” according to a U.S. Securities and Exchange Commission (SEC) complaint filed in federal court. “Good defrauded investors — including retirees — out of at least $4.8 million, resulting in more than $2 million of losses,”  the SEC said.

A spokesperson for Morgan Stanley told Advisorhub.com the bank “is reviewing the matter and that the alleged conduct is plainly unacceptable. Good is no longer employed by the bank.” The Morgan spokesman added “We are currently reviewing the matter, which affects a small number of clients, and are cooperating with the SEC and other government authorities.”

Chicago-based Stoltmann Law Offices is representing investors who’ve suffered losses from dealing with broker-advisors who have violated securities laws. When brokerage houses or investment advisers make big “block” stock trades, there are numerous rules they must follow to ensure that other investors don’t get burned. They are not allowed to “front run,” an illegal brokerage practice of a stockbroker placing an order for their own account ahead of the client’s, knowing when the client’s order is placed it will move the market and create a profit for the broker.

Disruptive Technology Solutions LLC, a software services company, and affiliated funds, have filed a demand for arbitration against Morgan Stanley with FINRA, the federal securities industry regulator, according to The Wall Street Journal.

“Disruptive alleges that Morgan Stanley and a senior executive there leaked information ahead of the fund’s sale of more than $300 million of Palantir in February 2021, resulting in tens of millions of dollars in damages,” the Journal reports. Disruptive is seeking compensatory and punitive damages. Palantir is a software firm that provides a wide range of platforms from artificial intelligence to supply chain products.

Chicago-based Stoltmann Law Offices has represented investors who’ve suffered investment losses at the hands of financial and investment advisers who churned and burned their accounts. One of the most prevalent abuses in the securities industry is excessive trading, or “churning” client accounts. This practice, which is forbidden by industry regulators like FINRA and the SEC, is done to generate commissions, almost always at the expense of the client. As the stock market swings wildly during the Covid-19 pandemic, brokers take advantage by trading their clients’ accounts to generate commissions.

Brokers can open the door to churning by asking customers if they want an “active” trading strategy, which gives brokers discretionary ability to trade at will. Unless clients give specific directions on how and when to trade, brokers may take the opportunity to trade excessively and charge needlessly high commissions.

Churning has been the subject of numerous regulatory actions over several decades. Broker Frank Venturelli, a representative for First Standard in Red Bank, New Jersey, was cited by FINRA for excessive trading between 2016 and 2018. According to FINRA settlement, clients lost more than $373,000 during that period. Venturelli was suspended from the industry for 11 months and ordered to pay partial restitution of $30,000 to his clients.

Stoltmann Law Offices is investigating Hilary Zimmerman, a broker with Morgan Stanley in Ridgeland, Mississippi. According to her Financial Industry Regulatory Authority (FINRA) BrokerCheck report, Zimmerman has been the subject of at least six customer complaints. Customers have alleged churning, making unsuitable investment recommendations, negligence, unauthorized trading, misrepresentations, fraud, breach of fiduciary duty and churning and excessive trading. These are all against securities laws and regulations. Churning is excessive trading in a customer’s account, only to generate large commissions for the broker.

Zimmerman was registered with Lehman Brothers in New York, New York from December 1991 until July 1993, Citigroup Global Markets in Jackson, Mississippi from July 1993 until December 2007 and currently, Morgan Stanely in Ridgeland, Mississippi since June 2009. She has six customer disputes against her, one of which is pending.

If you invested money with Hilary Zimmerman, please call our Chicago-based securities law firm at 312-332-4200 to speak to an attorney. The call is free with no obligation. Her firm, Morgan Stanley, may be liable for investment losses because they have a duty to reasonably supervise her. We take cases on a contingency fee basis only.

According to a Hearing Panel Decision by the Financial Industry Regulatory Authority (FINRA), Audra Lynn Lalley, a registered representative at Morgan Stanley Smith Barney in the Private Wealth Management group, allegedly effected a set of trades pursuing a particular investment strategy for a group of clients. Allegedly, Ms. Lalley did not contact the clients when she executed the trades. The client complained that he did not receive an explanation for the trades, either and then asked her to reverse the trade. In Ms. Lalley’s failure to obtain authorization to make the trades, Morgan Stanely, her former firm, can be held liable. They had a duty to reasonably supervise her while she was employed there and can be sued in the FINRA arbitration process. Ms. Lalley was employed by Goldman Sachs in New York, New York from October 1998 until April 2002, Morgan Stanley in Los Angeles, California from May 2002 until November 2011 and Barclays Capital, also in Los Angeles from November 2011 until May 2014. She has two customer disputes against her. She is not currently licensed to act as a broker.

If you invested money with Audra Lynn Lalley, please contact our securities law office at 312-332-4200 to speak to an attorney. The call is free with no obligation. We can help you discuss your options of suing Morgan Stanley.

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