Articles Posted in Broker-Dealers

New Class Action Offers Details Into Alleged GPB Ponzi Scam

This week in Austin, Texas, another proposed class securities case was filed on behalf of investors of GPB Capital Holdings and its many funds. This latest investor lawsuit directly accuses the alternative asset firm and its executives of running an alleged $1.8B Ponzi scam and provides new details into the fraud.  

Filed in the US District Court for the Western District of Texas by the lead plaintiff and GPB investor Millicent Barasch, the class action securities fraud case was announced at a press conference. Toni Caiazzo Neff, an ex-Financial Industry Regulatory Authority (FINRA) examiner, spoke about how she’d previously tried to blow the whistle on GPB Capital Holdings. 

Cetera Advisors Fraud Case Rises To $21M

Two months after suing Cetera Advisors for more than $10M for allegedly defrauding retail clients, the US Securities and Exchange Commission (SEC) has amended its complaint, adding another Cetera Financial Group firm as a defendant. The regulator is now seeking $21M.

According to the amended complaint, Cetera Advisors Network, also a registered broker-dealer and investment advisor, made over $10M in undisclosed compensation that retail advisory clients paid for in fees, mark-ups, administrative fees, and revenue sharing. 

SSEK Investigating Centaurus Financial Brokers 

Our brokerage firm misconduct lawyers at Shepherd Smith Edwards and Kantas, LLP (SSEK Law Firm) are representing investors who were sold structured certificates of deposits (CDs) by Centaurus Financial brokers Cindy Chiellini and Ricky Mantei. 

Both work out of Lexington, South Carolina and are the subject of numerous complaints by customers, many of whom are based in Colorado and were sold these CDs. Now, the Colorado Division of Securities is considering pulling Centaurus’s license in that state over its alleged failure to properly supervise Mantei and Chiellini. 

Newbridge Securities in Boca Raton, a Florida-based broker-dealer,  is censured by the Financial Industry Regulatory Authority (FINRA) and has been fined $225K over its purported failure to adequately supervise the sale of exchange-traded funds, structured notes, and other complex securities. 

The self-regulatory authority (SRO) also fined the firm’s investment banking director, Bruce Jordan, $5K for failing to properly supervise the sales. He is suspended for two months. 

GPB Private Placement Lawyers

Our investor lawyers at SSEK Law Firm are meeting with clients who’ve worked with Innovation Partners and suffered investment losses that they suspect may be due to fraud, negligence, or inadequate supervision. The North Carolina-based broker-dealer was recently fined $60K and censured by the Financial Industry Regulatory Authority (FINRA) after allowing its ex-co founder, president, CCO and CEO Patrick Emanuel Sutherland, to continue to have access to its email, other systems, records, and books, as well as engage in activities on its behalf, even after he was found guilty of multiple felonies in 2016.

Those felonies, including submitting a false tax return and obstruction of an official proceeding, should have disqualified him from associating with a member firm for a decade. Yet from approximately 10/28/2016 to 9/15/2019, Sutherland continued to remain involved with Innovation Partners, even discussing securities-related matters with associated persons at the brokerage firm and directing staff regarding commissions for transactions.

Meantime, Innovation Partners’ current CEO and President Yanique Elaine Lawrence reportedly knew about Sutherland’s continued involvement and was often copied on his direct communications with the firm’s registered representatives. Both Lawrence and Innovation Partners are accused of not setting up and enforcing a suitable supervisory system that should have prevented Sutherland from continuing to be involved with the firm.

Financial Industry Regulatory Authority (FINRA) has fined former Texas broker Steven Yellen $25K for allegedly making unauthorized trades while he was a registered representative for both Ameriprise (AMP) and Morgan Stanley (MS). The self-regulatory authority (SRO) notes at least 30 instances in which Yellen executed trades without customer authorization.

After more than 30 years in the industry, he is no longer affiliated with any broker-dealer after Ameriprise fired him last year. According to FINRA, from 3/2013 to 12/2015, Yellen  made 14 unauthorized trades while he was a Morgan Stanley broker, exercising unauthorized discretion in a client’s account. Meantime, when filling out compliance questionnaires, he neglected to disclose these activities.

In 2016, after 32 years with Morgan Stanley, Steven Yellen became an Ameriprise broker. During this time, he allegedly made 16 unauthorized trades in 10 customer accounts. These trades went beyond these customers’ risk levels that they’d authorized.

SSEK Investigating The Ex-Morgan Stanley Broker, Ami Forte

Earlier this year, our investor lawyers reported that the Financial Industry Regulatory Authority (FINRA) had filed a lawsuit against former Morgan Stanley broker, Ami Forte. She allegedly made unauthorized trades in the now-deceased Home Shopping Network co-founder, Roy Speer’s, account while he was afflicted with dementia. 

The self-regulatory authority has now announced that it is barring Forte. Shepherd Smith Edwards and Kantas (SSEK Law Firm) are currently investigating complaints and concerns by former customers of Ami Forte who are suspecting that their losses may be due to fraud. 

Former Raymond James (RJF) broker John Charles Wyshak is under scrutiny by our investor lawyers at SSEK Law Firm. If you are someone who previously worked with Wyshak as your financial representative while he was registered with Raymond James or any other broker-dealer, and you suffered substantial losses, your first consultation with us is a free, no obligation case assessment.

After over thirty years in the securities industry, Wyshak is no longer a registered broker or investment adviser. Recently, a Financial Industry Regulatory Authority (FINRA) arbitration panel ruled against Wyshak and in favor of Raymond James, ordering him to pay the firm nearly $1M for previous investor fraud claims involving his allegedly fraudulent actions and for breaching an agreement with the broker-dealer.

Wyshak left Raymond James last year. Now, the FINRA arbitrators want him to pay the firm more than $932K in compensatory damages, in addition to 10% interest and thousands of dollars in other fees.

Our investor fraud lawyers at SSEK Law Firm are looking into claims involving former Wells Fargo (WFC) broker Leonard Kinsman (Kinsman). Kinsman currently still faces at least two customer complaints that were brought before the Financial Industry Regulatory Authority (FINRA), one claim involves a New Jersey widow and mother of three who is accusing him of defrauding her family of their life savings.

Until July 2019, Kinsman belonged to the Wells Fargo Financial Network of brokers that operate independently, even as they use the bank’s compliance software and investment systems. No details have been provided into how or why he is no longer affiliated with the firm’s broker network.

According to the New York Post, the widow began working with Kinsman in 2012 when he was still a Merrill Lynch broker and after her husband had passed away. She requested that Kinsman place her money, a $2.27M life insurance settlement, in conservative, diversified investments that promoted long-term growth so she could support her family off the interest.

Misconduct Accusations Against Ex-Morgan Stanley Brokers

Broker Misconduct Case #1: John Tillotson

The Financial Industry Regulatory Authority (FINRA) has suspended ex-Morgan Stanley broker, John Tillotson, for 15 days and ordered him to pay a $5K fine after finding that he impersonated five clients during phone calls to a mutual fund company. This was so he could move their retirement money to the firm. 

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