FINRA Panel Orders Capital Securities to Pay Retired Teachers $2.38M
A Financial Industry Regulatory Authority (FINRA) arbitration panel has awarded retired schoolteachers Beryl Lakin and Janice Patin $2.38M for losses they sustained while they were clients of Capitol Securities Management, which is based in Virginia. The two claimants, who are former coworkers, alleged excessive trading, fraud, and unauthorized withdrawals and fund transfers. They accused one of the financial firm’s former registered representatives of stealing money out of their Capitol accounts.
The financial rep. whom they are accusing was Patin’s nephew, who has since committed suicide. Finra documents name him as “Mr. T.”
According to the FINRA arbitration panel, automatic monitoring programs had raised alerts of suspect activity in Patin’s account, including trades that appeared to be “unsolicited.” There also were reportedly signs of “excessive commissions… high margin balances… and short-term trading,” even though her account was meant to promote long-term growth and could only handle a “moderate” degree of risk. FINRA said that it appeared “unlikely” that Patin had personally recommended these trades.
Capitol Securities fired Mr. T in 2017. He later wrote letters to both Patin and Lakin in which he admitted to stealing from their accounts, as well as from other Capitol clients’ accounts. Mr. T. confessed to losing $1.5M of Lakin and Patin’s money.
He also admitted that he tried to make up for losses sustained in one customer’s account. He confessed that his efforts had resulted in more losses, money transferred in from other clients’ accounts, and more money lost via risky trades. Mr. T. also acknowledged that he’d charged commissions on trades that were never authorized and adding another $200K to his income over six years.
Investors Call on Federal Court To Award Nearly $2.7M for Their Investment Losses
Law360 reports that investors Joanne Brem and Charlotte Milliner are calling on a California federal court to award them nearly $2.74M in their investor fraud case against Bock Evans Financial Counsel, Ltd. They contend that the investment advisory firm lost almost all of their money in high-risk investments. The women are alleging fraud, gross negligence, and breach of fiduciary duty.
The two women sued Bock Evans in 2015, accusing the firm in a putative class action of placing almost all or all of their assets in foreign mining stocks that were extremely speculative and risky, which they said led to clients’ portfolios suffering losses amounting to “decimation.” Brem is claiming more than $165K in losses while Milliner is claiming to have lost $1.2M.
They accused the firm of negligence for not having enough diversification in their investment choices and for making risky investments, even as stock market indexes grew by over 50%. The women are seeking damages that they claim are relative to gains that an index fund would have experienced during the specific period at issue.
Now, Brem and Milliner are asking for a default judgment because they believe that Brock Evans Financial has been delaying the litigation process. Meantime, past efforts to settle have been unsuccessful.
Investor Fraud Lawyers
Our investor fraud lawyers of Shepherd Smith Edwards and Kantas, LLP (SSEK Law Firm) work with investors throughout the US in helping them to recover losses they sustained because of investment adviser fraud, financial adviser fraud, broker fraud, broker-dealer fraud, or other kinds of fraud or negligence. Your first consultation with us is a free, no obligation session in which we can help you determine whether you have grounds for an investor fraud claim.