Articles Tagged with SEC

AdobeStock_99700100-2-300x200The U.S. Securities and Exchange Commission (SEC) fined Barclays Plc $97 million for allegations that the bank falsely charged clients for services that were not being performed. Customers were overcharged nearly $50 million because of violations like imposing fees for due diligence that was never performed and collecting excess mutual fund fees by steering clients into more expensive share classes. The bank will pay a $30 million penalty and more than $60 million in disgorgement and prejudgment interest. If you were a client of Barclays, please call our securities law firm today at 312-332-4200 to find out how to reclaim your losses on a contingency fee basis. The call is free with no obligation.

AdobeStock_77502568-1-300x199David Humphrey, a former accountant with the U.S. Securities and Exchange Commission (SEC) was accused of illegally trading options while working there. He was employed with the agency for 16 years prior to the illegal trading. The SEC has strict securities trading rules for its employees, as many of them have access to non-public and market-making information. They are also banned from holding stock in companies directly regulated by the SEC and are required to get clearance prior to trading. Trading options is also banned for all SEC employees. Humphrey was charged with one criminal count of making a false written statement, after filing false government ethics forms that failed to disclose certain investments, according to a federal court filing. He is expected to settle related civil SEC charges, after he was caught trading options on his work computer for over a decade. He also traded options for his mother and a friend. He will also pay more than $100,000 in penalties and ill-gotten profits to settle the SEC civil case and will be barred from being an accountant.

The Securities and Exchange Commission (SEC) is investigating several alternative trading systems. It is looking for the “right balance between a principled regulatory approach and an aggressive and comprehensive enforcement effort,” Daniel Hawke, chief of the SEC’s market abuse unit, stated. The SEC will be focused on regulating “dark pools,” private exchanges or forums not accessible by the investing public and known for their complete lack of transparency. SEC chief Mary Jo White has said the agency will update its rules for dark pools in order to come down hard on illegal trading.

AdobeStock_33766885-1-300x200Yesterday, the Securities and Exchange Commission (SEC) announced that Morgan Stanley and Citigroup Global agreed to pay more than $2.96 million each to settle charges that they made false and misleading statements about CitiFX Alpha. CitiFix Alpha is a foreign exchange trading program that was sold to Morgan Stanley customers from August 2010 to July 2011, according to an SEC press release. Citigroup held a 49% ownership interest in Morgan Stanley and both firms were selling the foreign exchange trading program. The SEC stated that there were significant losses caused to investors because of the program’s past performance and risk metrics. There were also undisclosed leverage and markups. If you were a client of Morgan Stanley or Citigroup, you may be able to recover your losses if you were sold CitiFix Alpha Investments. The firms may be liable for your losses. To find out how to recover your money on a contingency fee basis, please call our law firm at 312-332-4200 to speak with an attorney for free. There is no obligation.

The Securities and Exchange Commission (SEC) questioned Wells Fargo & Co. over its accounting practices for $20 billion worth of troubled loans. The SEC asked Richard Levy, the bank’s controller to explain how Wells Fargo valued its portfolio, which it acquired by buying Wachovia. The valuation assumptions affect Wells Fargo’s earnings in that, when banks acquire distressed assets, they must value them in a way that involves some guesswork about whether the loans will be repaid. Questions have been raised as to whether Wells Fargo’s earnings are supported by underlying business growth or accounting maneuvers. In September, regulators ordered Wells Fargo to pay $190 million in fines and restitution to settle charges that its employees created as many as two million deposit and credit card accounts without the consent of customers. It then failed to convince regulators that it was the only major U.S. bank that could go bankrupt without causing a major market disruption.

According to a recent Securities and Exchange Commission (SEC) complaint, Richard G. Cody was accused of defrauding at least three of his clients for years by concealing the fact that their retirement accounts had suffered extensive losses, and the monthly payments they were receiving were exhausting their retirement savings. Cody allegedly also made materially misleading statements, leading the clients to believe their investments were maintaining steady value and that their monthly withdrawals were being financed by investment gains. In reality, the clients account values were being rapidly depleted. Cody allegedly made wire transfers of monthly deposits to his client’s bank accounts from sources and from their own retirement accounts so they would not be aware their funds had run out. He also sent clients fabricated tax forms which purported to show retirement account distributions and tax withholding in order to disguise the fact that the accounts were empty. On one occasion, Cody told a client that he had $1.28 million in their account, when, in reality they had only $162,560. This is against securities rules and regulations.

Cody was registered with Merrill Lynch, Salomon Smith Barney, Leerink Swann & Co., Gunnallen Financial, Westminster Financial, Concorde Investment Services and IFS Securities in Spring Lake, New Jersey from August 2016 until September 2016. He has six customer disputes against him, four of which are currently pending. This is according to his online Financial Industry Regulatory Authority (FINRA) BrokerCheck report. Please call us today if you suffered losses with Mr. Cody. We may be able to help you bring a claim against him for investment losses suffered. The call is free with no obligation so please call today.

The Securities and Exchange Commission (SEC) recently charged Gary E. Oliver with mismanagement of client assets and failure to disclose conflicts of interest. Mr. Oliver was previously registered with Fortius Financial Advisors. He agreed to cease and desist from violating the charges and agreed to a bar from the industry. He also was forced to pay $153,862 in disgorgement and prejudgment interest and pay an additional $125,000 penalty. Oliver and another representative, Jeff M. Bollinger, allegedly invested more than $800,000 of the firm’s assets in unsuitable, illiquid investments. Both men had financial interests in the investments. Mr. Oliver allegedly appropriated $137,000 from the firm’s account over four years. These are all against securities rules and regulations. Please call our securities law firm today if you invested with Gary E. Oliver. We may be able to help you bring a claim against his former firm, Fortius Financial Advisors in the arbitration forum. The call is free with no obligation so please call today.

The Securities and Exchange Commission (SEC) ordered EZTD to pay more than $1.7 million for misleading investors into trading binary options online before January 2014. EZTD Inc. manages three binary options brands,, and The SEC fined EZTD Inc. for failing to register as a broker-dealer to legally sell the offer the instrument to U.S. investors. EZTD also allegedly did not properly disclose the loss risks. The SEC claimed that EZTD made statements that falsely inflated the profitability of trading binary options, referring to it as a “highly profitable trading platform,” and an “extremely lucrative avenue for individuals who are looking to see an increase in income.” Many other firms in operation may be subject to the same fine, warned the SEC. According to the SEC, less than three percent of the 4,000 US investors who opened accounts with the group were actually able to make profits on their investment. EZTD will forfeit $1.5 million in revenue obtained from US customers and pay a $200,000 penalty. The company no longer sells binary options in the US. A Division of Enforcement representative at the SEC stated: “EZTD’s revenues were largely derived from customer trading losses, yet EZTD emphasized the profitability of trading in binary options. Companies dealing in binary options must disclose more than general statements about investment risk so investors in these instruments understand that the odds are stacked against them.” Please call us today if you lost money in binary options trading with EZTD. Attorneys are standing by to take your call for free to discuss your options of recovering your losses.

The Securities and Exchange Commission (SEC) recently charged a PricewaterhouseCoopers partner with allegedly failing to find a fraud during his audit of Burrill Life Sciences Capital Fund III, a venture capital fund. Adrian D. Beamish allegedly failed to catch millions of dollars in “advanced” management fees taken as unauthorized related-party transactions. He also allegedly failed to ensure that the transactions were properly disclosed in the fund’s financial statements. Earlier this year, G. Steven Burrill, the owner and principal of the investment adviser of the fund, settled a case with the SEC to the tune of almost $5.8 million that alleged that he spent fund assets to keep other businesses afloat, on family vacations and to pay other personal expenses. Beamish was based out of San Jose, California. If you lost money in the fund, please call our securities law offices in Chicago at 312-332-4200 to speak to an attorney. We may be able to help you recover your losses on a contingency fee basis. The call to us is free with no obligation.

The SEC recently whacked two public companies for requiring separating employees to sign agreements in which they waived their rights to any money paid in connection with a complaint or charge filed with an administrative agency. The SEC also objected to clauses that Blue Linx Holdings, Inc. and Health Net, Inc. included in severance agreements that required the separating employees to notify the company before disclosing any financial or business information to the SEC. The companies are BlueLinx Holdings Inc. and Health Net, Inc.
The SEC considers restrictions like these to be illegal impediments to potential whistleblowers that are prohibited by the Dodd-Frank Act. Even though Health Net’s severance agreement stated that nothing in the agreement should impede the employee from communicating with or providing information to any government regulator, the company still forced separating employees to forego potential whistleblower bounties, which constitutes an impediment to participating in the SEC’s whistleblower program.
Health Net agreed to pay a civil penalty of $340,000. Blue Linx agreed to pay  civil penalty of $265,000. Both companies agreed to contact former employees to inform them that the agreements do not prohibit former employees from (1) providing information to, or communicating with, SEC staff without notice to the company, or (2) accepting a whistleblower award from the SEC.
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