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Articles Posted in Inadequate Supervision

Michigan Stockbroker Was Fired By Securities America

Jaime Michael Westenbarger, a former Securities America registered representative in Michigan, is currently named in three pending customer complaints accusing him of negligence and stockbroker fraud. Westenbarger, who was fired by the broker-dealer last year, has been barred by the Financial Industry Regulatory Authority (FINRA).

He worked 16 years in the securities industry. Our securities fraud lawyers at SSEK Law Firm are offering free case consultations to former customers of Jaime Westenbarger who’ve suffered significant investment losses. You may have grounds for a FINRA arbitration claim to recover damages. 

Family Trust to Receive Compensatory Damages From Broker-Dealer 

In its Financial Industry Regulatory Authority (FINRA) arbitration claim against Raymond James & Associates and former broker Paul Anthony Steffany, the Angelina J. Cuccaro Family Trusted was awarded $320K in compensatory damages. 

The claimant contends that it was the victim of broker negligence and the firm’s failure to supervise.  The former Connecticut broker was barred by the self-regulatory organization (SRO) in 2015.  

Senior Investor’s Loses Retirement Funds Because of Unsuitable Investment

An Arkansas retiree has filed a Financial Industry Regulatory Authority  (FINRA) arbitration claim against LPL Financial for losses he suffered because of the unsuitable recommendation of Rhett Douglas Bedwell, one of the broker-dealer’s former registered representatives. Bedwell, who is no longer a  stockbroker or investment advisor, is accused of defrauding a number of customers. 

Now, this retiree is seeking up to $500K in investment loss damages after Bedwell invested a significant portion of his retirement funds in what appears to have been a Ponzi scam involving Small World Capital and the now defunct, Graysail Capital. 

Morgan Stanley Settlement Includes FINRA Fine and Investor Restitution 

According to the Financial Industry Regulatory Authority (FINRA), Morgan Stanley Wealth Management has consented to pay a $175K fine and more than $774K in restitution for allegedly failing to supervise its former broker Kevin Gunnip. 

The Texas-based financial representative is accused of excessively trading in preferred securities and corporate bonds over five years, causing 10 customers to lose more than $900K. 

FINRA Bars Ex-Registered Rep, Who Wouldn’t Cooperate In Investigation 

Christopher Duke Bennett, an ex-Hilliard Lyons broker, is barred by the Financial Industry Regulatory Authority (FINRA). Bennett has been the subject of 15 numerous securities fraud customer disputes over the years. 

The bar comes after he refused to cooperate in the self-regulatory organization’s (SRO’s) probe that was opened in the wake of several people accusing him of unauthorized trading and making unsuitable investment recommendations. Bennett also is no longer a registered investment adviser.

Ex-Morgan Stanley Broker Admits To Criminal Investment Fraud, Faces SEC Charges

Michael Barry Carter, a former Morgan Stanley (MS) broker, has pleaded guilty to federal investment fraud and wire fraud charges involving a scam in which he defrauded five customers. This included at least one elderly client, of more than $6M. The scheme took place over 12 years. After his acts of broker fraud were uncovered, Carter took money from other investors to pay back his other victims.

Morgan Stanley fired Carter last year. He also is now facing parallel Securities and Exchange Commission (SEC) civil charges.

Colorado Investment Firm Fined $200K For Investing Unqualified Buyers Into Unsuitable Investments 

The US Securities and Exchange Commission (SEC) has ordered First Western Capital Management Co. to pay a $200K fine over allegations that, over a 7-year period, it invested over $666M of clients’ funds into securities that they didn’t qualify for. As a result, 81 clients were placed in securities that were reserved for qualified institutional buyers (QIBs), which are investors that have at least $100M in assets.

The firm is a Denver-based investment adviser. Our Colorado investment fraud lawyers at Shepherd Smith Edwards and Kantas are offering free case consultations to customers that were harmed by these unsuitable investment recommendations and sales that the SEC says were initiated by at least nine of First Western’s investment adviser representatives. Contact us today at (720) 439-2827

Former Financial Representative Is Facing Criminal Trial for Annuity Fraud 

The Financial Industry Regulatory Authority (FINRA) has fined Northwestern Mutual Investment Services $350K for failing to properly supervise former stockbroker, Sampson Pearson, which enabled him to defraud customers of $570K. Northwestern Mutual Investment Services is the brokerage arm of Northwestern Mutual Life Insurance Co.

Pearson, who was barred by the self-regulatory organization (SRO) in 2017, is charged in federal court with aggravated identity theft, mail fraud, and filing false tax returns. According to his BrokerCheck record, he is named in 13 disclosures, including 11 customer disputes. 

FINRA Says SagePoint Financial Brokers Unsuitably Recommended Early UIT Rollovers 

The Financial Industry Regulatory Authority (FINRA) is ordering SagePoint Financial to pay over $1.6M in fines and restitution after it executed over $895 million in unit investment trust (UIT) transactions that resulted in more than $17.2 million in sales charges. 

Of these UIT transactions, over $203.7 million of the proceeds were from sales that occurred over 100 days before a UIT’s maturity date. FINRA found that these unsuitable early rollovers caused customers to pay over $1.3 million in sales charges that they wouldn’t have otherwise if only they’d held onto their UITs until they matured.

Elderly Investor Alleges Unsuitable Investment Recommendations Caused REIT Losses

An Oklahoma retiree is seeking up to $500K in damages for investment losses she suffered while working with Kovack Securities broker, Susan Penney. 

The claimant contends that Penney and the broker-dealer misled her and made unsuitable recommendations when they persuaded her to invest a huge portion of her portfolio in non-public Real Estate Investment Trusts (REITs) and other risky investments that an inexperienced investor like her should never have been involved in.

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