Articles Posted in Broker Fraud

Ex-Securities America Broker Investigated For Ponzi Scam Involvement

The US Securities and Exchange Commission (SEC) announced that it has permanently barred ex-Securities America broker, Ronald Roach, in the wake of his involvement in a $909M Ponzi fraud. 

Ronald Roach pleaded guilty last month to criminal fraud charges and is facing up to 10 years behind bars. According to InvestmentNews, Securities America fired him the day after he entered his plea. The SEC contends that Roach and Joseph Bayliss, a general building and electrical contractor, operated an alternative energy tax credit Ponzi scam associated with the company DC Solar. 

UBS Loses Another Puerto Rico Bonds & Closed-End Fund Case

More than six years after thousands of investors lost many millions of dollars from investing in Puerto Rico bonds and closed-end bond funds, UBS Puerto Rico (UBS-PR) is still being held to account for the financial losses faced by many of its clients. 

This includes one claimant who was recently awarded over $150,000 in compensation plus interest, other costs, and fees in her Financial Industry Regulatory Authority (FINRA) arbitration case against the firm.  

Shepherd, Smith, Edwards & Kantas (“SSEK”), a national law firm specializing in representing wronged investors, is looking into allegations against Mengxuan Zhang, previously employed by Cetera Investment Services out of Pasadena, CA.   According to allegations, Ms. Zhang allegedly falsified customer signature pages on new account forms for some customers of Cetera. This included reusing signature pages without express permission and changing the dates on the forms so as to appear that customers had re-executed. One of the forms in question was an “illiquid investment acknowledgment form.”  This is the type of form an investor in such products as GPB Capital or NorthStar Healthcare REIT would have to sign. After admitting her wrongdoing to Cetera, Ms. Zhang was officially discharged. She is currently not employed by any Broker Dealer as a financial advisor.

For her actions, Ms. Zhang has been suspended as a stockbroker/advisor by The Financial Industry Regulatory Authority Inc. (FINRA). She was also fined. Ms. Zhang accepted and consented to the findings by FINRA without admitting or denying the findings.  According to FINRA, such actions on the part of Ms. Zhang violate FINRA Rule 2010.  According to that Rule, a stockbroker/advisor must “….observe high standards of commercial honor and just and equitable principles of trade.”  Under the terms with FINRA, Ms. Zhang may not make any statement publicly which denies FINRA’s findings regardless of the fact that she never specifically denied the allegations.

Financial Advisor Fraud Attorneys

SSEK Investigates Capital Financial Investments And Ex-Broker Sean Kelly Over Investor Claims

At the heart of recent investor claims against Capital Financial are allegations against one of its ex-brokers, Sean Kelly. 

Sean Kelly was accused last year by the US Securities and Exchange Commission (SEC) of defrauding a dozen investors. These investors, including senior retirees, were defrauded of over $1M through three of his companies, including Lion’s Share and Associates, that is based out of Georgia. 

SSEK Investigates JP Morgan Securities And Ex-Employee, Donovan St. Anthony Hunter 

Shepherd, Smith Edwards & Kantas (“SSEK”), a law firm specializing in representing wronged investors, is looking into allegations against Donovan St. Anthony Hunter, previously employed by JP Morgan Securities out of Houston, Texas.

Prior to that, he worked at Wallis State Bank. According to allegations, Hunter used the office of his position to solicit investments in an outside business activity. This outside investment entity was not approved by JP Morgan Securities. 

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. 

The New Jersey Bureau of Securities has revoked the registration license of First Standard Financial Company, a broker-dealer based in Red Bank, NJ. The move comes in the wake of allegations that First Standard and its representatives engaged in improper short-term trading, causing them to illegally make over $28.7M in sales charges and commissions.

Meantime, there have reportedly been an increase in customer complaints and a “mass exodus” of First Standard representatives from the firm. The state’s securities regulator is accusing the brokerage firm of “pervasive unauthorized, unsuitable, and excessive trading” that cost customers money while “unjustly enriching First Standard and its agents.”

Our brokerage firm misconduct lawyers at Shepherd Smith Edwards and Kantas, LLP (SSEK Law Firm) are investigating claims of current and former customers of First Standard Financial Company and its brokers, including former licensed agents Philip Sparacino and Gabriel Block. Please contact us today so that we can help you explore your legal options.

Morgan Stanley Ordered To Pay Over $300K In Fines And Restitution

Secretary of the Commonwealth of Massachusetts, William Galvin, is ordering Morgan Stanley (MS) to pay a $200K fine, as well as $182K in restitution to four customers who suffered losses while working with former broker Justin E. Amaral. 

The ex-Morgan Stanley financial advisor was barred by the Financial Industry Regulatory Authority (FINRA) in 2015. 

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 Ex-Raymond James Advisor, Stuart Nichols 

Another former Raymond James advisor has gotten into trouble over fraud allegations. The Financial Industry Regulatory Authority (FINRA) recently barred Stuart Nichols, a former broker with the firm, after he failed to participate in the self-regulatory authority’s probe into churning allegations made against him. 

Churning involves engaging in excessive trading in a brokerage account for the purposes of making commissions. 

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