Articles Tagged with stock

Stoltmann Law Offices is interested in speaking to those individuals who may have invested money with Matthew Lilleberg, a registered representative with Moloney Securities in Minnesota. Lilleberg has been accused of executing unauthorized trades, executing an unauthorized purchase of a stock, and recommending unsuitable investments. These are all against securities rules and regulations. Lilleberg was registered with Wells Fargo Investments in Aspen, Colorado from March 2004 until October 2008, Brookstone Securities in Willmar, Minnesota from September 2010 until June 2012 and Minnesota Valley Investments in Willmar from August 2012 until March 2014. He is currently registered with Moloney Securities in Willmar and Spicer, Minnesota and has been since April 2014. He has eight customer disputes against him. If you or someone you know has invested money with Matthew Lilleberg, please call our securities law firm in Chicago to speak to one of our attorneys about your options of suing Moloney Securities in the FINRA arbitration forum on a contingency fee basis. We help investors recover financial losses.

According to a recent New York Times article entitled “Morgan Stanley Neglected Warnings on Broker,” Steve Wyatt, a Morgan Stanley broker in Ridgeland, Mississippi, was accused of trading account erratically. He was also accused of improperly managing tens of millions of dollars in client money. Mr. Wyatt was with the company for five years, finally being terminated in 2012, after two years of investigation against him. Former clients claim they lost about half their money with him, or around $50 million. This past week, the Mississippi secretary of state said in a settlement with Morgan Stanley that it had “failed to reasonably supervise” Mr. Wyatt. The settlement subsequently barred Mr. Wyatt and his immediate supervisor from the securities industry for life and Morgan Stanley was forced to create a $4.2 million fund to reimburse clients for their losses. So far, in its cases, Morgan Stanley has had to pay about $3 million. Allegedly, Mr. Wyatt raised so much concern that Morgan Stanley supervisors stopped him from trading in his personal accounts, yet, the firm allowed him to continue to trade money he managed for clients.

In his first year at Morgan Stanley, Wyatt put his client’s money into only two stocks, BlackBerry and Valence, a batter maker that later went bankrupt. Four clients saw their stocks fall more than 60 percent. He also allegedly bought 60 percent of the outstanding shares in a small Israeli computer cable company, RiT, for his clients. The heavy concentration in a single stock was problematic. He was terminated by he firm when evidence showed he had been using a personal email address to push clients to buy investments that he held in his own private accounts. Morgan Stanley can be liable for investment losses because of Mr. Wyatt, or another broker’s failure to take into account client’s best interests. We sue firms such as Morgan Stanley in the arbitration process for clients who have lost money, and we do so on a contingency fee basis only, so we only make money if you recover yours. Please call us today to discuss your options. The call is free.

Two Chattanooga, Tennessee-based brokers, James Hugh Brennan III and Douglas Albert Dyer are under investigation for securities fraud by the Securities and Exchange Commission (SEC), the Tennessee Department of Commerce & Insurance (TDCI) and the FBI. Both operated Broad Street Ventures in Chattanooga, Tennessee, and allegedly raised more than $5 million from investors without using the money as promised. In February, the TDCI failed a cease-and-desist order against Broad Street, Brennan and Dyer, alleging that they had sold unregistered securities, were not registered to sell securities in Tennessee, and had engaged in fraud by failing to disclose the existence of a desist-and-refrain order previously issued in California. The SEC issued an asset freeze on July 22nd. The TDCI then referred the case to the SEC and FBI for further action.

Both men allegedly sold shares in eight similarly named companies to more than 240 investors since 2008 without ever registering the stock they promised. They then transferred the money to personal accounts or to those belonging to their wives. They failed to tell investors that Brennan was banned from the brokerage industry and Dyer was suspended and fined for executing unauthorized transactions in customer accounts. If you believe you are a victim of Brennan or Dyer, or Broad Street Ventures, please call our securities law offices in Chicago at 312-332-4200. The call is free with no obligation. Attorneys are standing by to take your call.

Stoltmann Law Offices is investigating Randall A. Heller, a stock broker who is currently employed by KCD Financial, Inc. Heller is accused of making an unsuitable investment recommendation in a real estate investment trust (REIT). REITs tend to be risky, illiquid investments that are not suitable for all investors. A broker must take into account an investor’s net worth, age, investment sophistication and portfolio objectives before recommending an investment. If he does not, his firm or former firm can be held liable for investment losses for not reasonably supervising its brokers. Please call our Chicago-based law offices today to speak to an attorney about your investment losses to find out how we may be able to help you bring a claim against KCD Financial for Heller losses. The call to us is free. 312-332-4200.

Heller was registered with Waddell & Reed, Pruco Securities, Metropolitan Life Insurance Company, MetLife Securities, The Prudential Insurance Company, Fortis Investors, and Waterstone Financial Group. He is currently registered with KCD Financial in Oak Lawn, Illinois and has been since March 2005. He has one customer dispute against him, which is currently pending.

Alvin S. Mirman, of Sarasota, Florida, was accused Thursday of fraudulently registering and secretly selling stock in shell companies. He was charged by federal prosecutors with conspiracy to commit securities fraud in a penny-stock scheme that netted $6 million. Last year, the Securities and Exchange Commission (SEC) filed a civil complaint against Mirman, claiming he violated numerous federal securities laws by selling “blank-check” companies that were falsely presented to investors as legitimate start-up businesses. Mirman was a former stockbroker who was banned from the securities industry in 2007. Allegedly, Mirman, along with other conspirators, recruited individuals to serve as straw CEOs for shell companies, some of which had addresses in Sarasota and Manatee counties. For almost seven years, the conspirators prepared phony corporate documents, including stock certificates and shareholder lists, and submitted them to the SEC in order to register securities offerings. The men then would find people to pretend they were shareholders, thereby creating class of shares that could be publicly traded. The “shareholders” were promised money after the company was sold. The buyer’s acquisition of the company would typically take the form of a reverse merger and be publicly disclosed. The secretly controlled unrestricted shares would typically be transferred to a third party or other account designated by the buyer, and would not be disclosed to the SEC or the public. In this way, the buyer would be in a position immediately to engage in stock swindles or other manipulation schemes.

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 Securities and Exchange Commission (SEC) banned Lee Weiss from the brokerage and investment advisory industry for his involvement in a fraudulent scheme. A French company claimed it could reduce the harmful effects of tobacco smoking, and Mr. Weiss and his registered investment advisory firm fraudulently advised clients and hedge funds to invest more than $40 million in securities issued by companies owned by Biosyntec. Biosyntec claimed to have developed a cigarette filter that reduced the risk of lung cancer. Mr. Weiss was paid $600,000 by the company shortly after the investments were made. Weiss and his firm, Family Endowment Partners LLC, will pay about $8.4 million in relief to investors he duped. Combined, they have been ordered to pay a $1.5 million civil penalty.

The SEC alleged that from 2010 until 2012 Mr. Weiss and his registered investment advisory firm fraudulently advised clients and hedge funds to invest more than $40 million in securities issued by companies owned by Biosyntec. The SEC alleged he failed to disclose conflicts of interest to clients and how their investments were used. The agency filed a complaint against him in federal court in Massachusetts last year. In 2011, Weiss advised a client of Family Endowment to invest $2.5 million in a Biosyntec subsidiary, knowing the money would be used to pay delinquent interest owed to other clients of the firm, according to the complaint. He also recommended customers buy $8.5 million in the company’s notes and stock, failing to disclose that the funds would pay financial obligations rather than benefit the company in which they invested. He also failed to disclose the “significant risk” that the notes would never be repaid.

The U.S. Securities and Exchange Commission (SEC) sued a United Kingdom man accused of hacking into the online brokerage accounts of U.S. investors. Idris Dayo Mustapha allegedly placed unauthorized stock trades and hacked into accounts to buy more than $5 million in stocks of little-known companies in April and May. He also sold his own personal stocks at the same time. This cost his nine victims $289,000, while he made at least $68,000. Mustapha was charged with securities fraud.

Stoltmann Law Offices is interested in speaking to those individuals who may have sustained investment losses in the Rampart Options Management Services Program (Rampart) with Merrill Lynch. A customer is seeking damages of $500,000 for losses sustained from an unsuitable recommendation to invest in Rampart. The customer worked over 23 years with UPS and accumulated shares of the stock through the UPS Employee Stock Purchase Plan and Manager Incentive Program. The financial advisor and Merrill Lynch recommended Rampart to facilitate the unsuitable investment strategy of selling covered call options on the UPS stock to produce income. The recommendations was unsuitable for a UPS investor with low cost basis stock who did not want to have UPS stock “called away” and trigger a large capital gains tax. Merrill Lynch advised the sale of call options at strike prices that were too low given market conditions and failed to buy back the options to ensure the stock was not called away. Because of this, the customer lost over 3,800 shares of his stock as a result of Merrill Lynch’s failure to recommend suitable options strategies for concentrated stock positions.

If you are a current or former UPS employee who has suffered investment losses in a Merrill Lynch account that used Rampart, please call our law offices at 312-332-4200 to speak to an attorney. We may be able to help you recover your investment losses by suing Merrill Lynch in the Financial Industry Regulatory Authority (FINRA) arbitration process. The call to us is free and there is no obligation. We take cases on a contingency fee basis only.

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