Articles Tagged with sales

Stoltmann Law Offices is interested in speaking to those investors who may have invested money with Cheryle Anne Brady, a former broker with Ameriprise Financial in Hingham, Massachusetts. Ms. Brady was assessed a deferred fine of $7,500 and suspended by the Financial Industry Regulatory Authority (FINRA) for allegedly falsely stating to her member firm that she had contacted clients prior to trades being placed. She allegedly placed trades in her clients’ accounts without first obtaining the clients’ approvals. Allegedly, a member of her sales supervision team sent her an email containing a list of the trades and inquired if Brady had spoken with each client on that day. Brady responded that she had spoken to each of the clients, and, after each call, had instructed her sales assistant to place the trades. Later, she admitted she did not speak to the clients before the trades were placed. This is against securities laws and internal firm rules.

According to her online BrokerCheck report with FINRA, Ms. Brady was previously registered with Pioneer Funds Distributor in Boston, Massachusetts from January 1993 until May 1993, Linsco/Private Ledger in Boston from June 1993 until March 1994, A.G. Edwards & Sons in St. Louis, Missouri from January 1995 until May 1997, UBS Painewebber in Weehawken, New Jersey from June 1997 until March 2002, RBC Capital Markets in Norwell, Massachusetts from March 2002 until February 2012 and Ameriprise Financial Services in Hingham, Massachusetts from January 2012 until October 2016. She has three customer disputes against her. She is not currently registered as a broker and has been suspended from the industry.

Unfortunately, you are not alone. Many brokers at firms like LPL and Ameriprise were sold high risk, illiquid Tenants In Common (TICs). These sales are coming back to haunt brokerage firms. Dozens of clients have filed lawsuits in recent years related to claims made in TIC sales.

Regulators have been sounding the alarm on fraudulent sales practices related to TICs for years. For example, as early as 2005, the Financial Industry Regulatory Authority (FINRA) issued the first of several notices reminding brokerage firms that it was inappropriate to recommend a TIC transaction if the recommendation was based solely upon information and representations made by the sponsoring company in the TIC’s offering document. When brokerage firms get sued for TICs related sales, a common defense is “we relied on what the TIC sponsor sent us.” FINRA has made clear that this is not enough in terms of due diligence.

Instead, brokerage firms were required as FINRA made clear to conduct a “reasonable investigation” of their own in order to ensure that the offering documents did not contain false or misleading information. FINRA also disclosed members needed to have a clear understanding of the investment goals and current financial status of the investor before recommending a TIC exchange. Unfortunately, many times the reasonable investigation consists of an analysis of how much the broker or brokerage firm will earn.

We are investigating the sales practices of New York based Max International Broker Dealer Group. The firm was recently censured, fined $335,000 and ordered to pay $482,111.27, plus accrued interest, in restitution to customers. The firm appealed the decision to the NAC but later withdrew its appeal. The sanctions were based on findings that the firm willfully charged fraudulent, excessive, undisclosed markups to customers in connection with the sale of large volumes of penny stocks from its proprietary account.

The findings stated that the firm charged commissions, implying to some of its customers that the commissions represented all of the firm’s profit from the transactions. The findings also stated that the firm failed to record trade details on order tickets and other records, failed to record the terms of the sales accurately, and failed to report the trades as required, which kept customers and regulators from detecting the fraudulent markups. To learn if investment losses at Max International can be recovered, please call us.

We’ve represented dozens of Ameriprise (formerly known as American Express)and other brokerage firm clients in arbitration claims for unsuitable investment recommendations in variable annuities. Variable annuity sales have been a major source of arbitration claims and lawsuits against the firm and other brokerage firms as well in the last 10 years.

Few products pay as well as variable annuities do. Huge commissions often provide a compelling incentive for financial advisors to jam a variable annuity into a client’s account even when it might not be appropriate. Huge surrender charges and unsuitable, high risk sub-accounts many times lead to financial ruin for the victims who were recommended a variable annuity. Especially problematic are sales where significant concentrations of the client’s portfolio are in a variable annuity.

Ameriprise was recently drilled in a FINRA arbitration claim for variable annuity sales. A Minnesota client was recently awarded $470,000 for sales abuses by an Ameriprise financial advisor? Why? Variable annuity sales. The client was awarded part of his losses, attorney fees and sanctions.

We are investigating the sales practices of former Money Concepts Capital Corp. financial advisor Frederick G. Brimmer II out of Marietta, Georgia. Without admitting or denying the findings, Brimmer consented to the described sanction of FINRA and to the entry of findings that he misappropriated $10,000 from two elderly brokerage customers who had provided him with the money for a supposed investment in an auto broker sales business; and rather than invest the money on the customers’ behalf, Brimmer deposited the money into his personal bank account and never gave of any of the money or returns to the customers. The findings stated that Brimmer intentionally and recklessly omitted material facts in connection with his solicitation of elderly brokerage customers to purchase certain securities. Brimmer’s material omissions consisted of failing to disclose to each customer that he anticipated receiving a referral fee totaling $30,000 for introducing the brokerage customers to an individual who entered into promissory notes with each customer and committed to repay the customers’ principal investments (collectively totaling $150,000) plus returns of 200 percent within maturity dates of roughly a month of the execution of the promissory notes. None of the customers received any of their principal or promised interest as of the maturity date of the promissory notes.

For clients who lost money with Fred Brimmer, some, or all, of the investment losses might be recoverable through the FINRA arbitration process against Money Concepts. The firm has a duty to reasonably supervise his activities while employed by the firm. Failing to do so can make Money Concepts responsible for the losses through the FINRA arbitration claims process. To learn about what can be done to recover Brimmer related losses, please call our law firm.

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.

Last week, the Financial Industry Regulatory Authority (FINRA) ordered Hilliard Lyons to pay back $1 million to its clients for failing to waive sales fees on mutual funds for eligible institutional clients. FINRA alleged that Hilliard Lyons advisers had been selling retirement plans and charitable organizations mutual fund shares that carried front or back-end sales charges or recurring expenses and fees. Those clients should have received waivers of the sales charges associated with Class A shares of the mutual funds, but were instead sold Class A shares that carried the fees or Class B and C shares with back-end and higher ongoing expenses. In December of last year, Hilliard Lyons admitted that its advisers overcharged 1,060 clients around $716,000 in sales charges that should have been waived. The firm was then censured by FINRA and paid $812,000 in restitution. Other firms FINRA has hit with similar fines include Merrill Lynch, Edward Jones and Baird. Please call us at 312-332-4200 if you lost money with Hilliard Lyons. The call is free.

Wells Fargo was just fined $35 million by the Office the Comptroller of the Currency (OCC) today for allegations that the bank made unsafe or unsound sales practices. The bank was also ordered to make restitution to customers who were harmed by the unsound practices. These included the unauthorized opening of deposit or credit card accounts and the transfer of funds from authorized, existing accounts to unauthorized accounts. The bank also failed to develop and implement an effective an enterprise risk management program to detect and prevent the unsafe or unsound sales practices. For those customers who were harmed by Wells Fargo, we encourage you to call our Chicago-based securities law firm to speak to an attorney about your options of suing the bank for the unsafe and unsound sales practices. We may be able to help you recover your investment losses with Wells Fargo.

According to a recent Letter of Acceptance, Waiver and Consent (AWC) with the Financial Industry Regulatory Authority (FINRA), SG Americas Securities was censured and fined $20,000 for violations of equity trade reporting. FINRA alleged that between May 1, 2014 through August 31, 2014, the firm failed to submit 1,862 last sales reports of transactions in designated securities. This is against securities rules and regulations. If you invested money with SG Americas Securities, please call our securities law offices in Chicago to speak to an attorney about your options of suing the firm in the FINRA arbitration forum on a contingency fee basis. The call is free with no obligation.

The Financial Industry Regulatory Authority (FINRA) recently charged two Boca Raton, Florida firms, Newbridge Securities and Shearson Financial Services, for securities violations that resulted in customers losing money. Newbridge Securities Corp allegedly failed to apply discounts to certain purchases. These discounts were supposed to be applied to sales charges, and as a result, clients paid more than $172,000 in excess charges. This misconduct occurred with unit investment trust (UIT) purchases from May 2009 until April 2014. Newbridge was fined $115,000 and agreed to pay clients back more than $188,000.

Shearson Financial was fined $100,000 by FINRA for allegedly inaccurately marking orders as unsolicited, even when they were solicited. The firm was warned in 2012, that 47 order tickets had been inaccurately marked. FINRA also stated that Shearson maintained inaccurate books and records of 1,873 transactions from June 2013 until October 2015. Please call us today for a free consultation with an attorney if you invested money with Newbridge Securities or Shearson Financial. We may be able to help you bring a claim against the firm for investment losses. We take cases on a contingency fee basis only.

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