failure to supervise

Triad Advisors To Pay $194K For Supervisory Failures Involving Short-Term Trading of Mutual Fund Class A Shares

Published on: February 16, 2021 | by Shepherd Smith Edwards & Kantas, LLP

Settlement in FINRA Case Involves Repaying Nearly $44K to Affected Customers

The Financial Industry Regulatory Authority (FINRA) has ordered Triad Advisors to pay a $150K fine for not adequately supervising both short-term trades involving Class A shares of mutual funds and variable annuity exchanges. The self-regulatory organization (SRO) also accused the Atlanta-headquartered broker-dealer of not making timely disclosures involving customer complaints and arbitration.

Triad Advisors, which is an Advisor Group network brokerage firm, consented to repay clients that were affected nearly $44k as part of its settlement for this case. It is not, however, denying or admitting to FINRA’s findings.

FINRA Orders Worden Capital Management to Pay Over $1.5M For Brokers’ Churning

Published on: January 19, 2021 | by Shepherd Smith Edwards & Kantas, LLP

Worden Capital Management’s Settlement Includes $1.2M in Customer Restitution

In December 2020, Worden Capital Management, a New York-based broker-dealer, arrived at an over $1.5M settlement with the Financial Industry Regulatory Authority (FINRA) over excessive trades made by the firm’s registered representatives.

The self-regulatory organization (SRO) contends that from January 2015 to October 2019, the New York brokerage firm did not have the kind of supervisory system in place that would have allowed it to “achieve compliance” with rules having to do with churning and excessive trading.

Hannes Financial Services’ Ronald Hannes Allegedly Defrauded Woodbury Financial Customers

Published on: November 20, 2020 | by Shepherd Smith Edwards & Kantas, LLP

Banned Woodbury Financial Broker Allegedly Sold Fake Investments, Converted Client Monies

Ronald Walter Hannes, a Spokane, Washington-based investment advisor and former Woodbury Financial Services broker, is accused by the Washington State Department of Financial Institutions of defrauding 19 clients of over $2.9M.

Hannes had operated out of Hannes Financial Services and he was also a registered Woodbury Financial Services broker for 25 years until 2019. He has 33 years of experience working in the industry. Hannes was fired by Woodbury Financial Services last December. Financial Industry Regulatory Authority (FINRA) barred him in February.

Former Customer of Ex-Raymond James Broker Paul Steffany Wins $320K Award

Published on: September 14, 2020 | by Shepherd Smith Edwards & Kantas, LLP

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.

Morgan Stanley Wealth Management To Pay Over $949K for Inadequately Supervising Ex-Broker Kevin Gunnip

Published on: August 25, 2020 | by Shepherd Smith Edwards & Kantas, LLP

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.

Former Hilliard Lyons Stockbroker Christopher Bennett Named in 15 Securities Fraud Claims

Published on: August 17, 2020 | by Shepherd Smith Edwards & Kantas, LLP

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 Pleads Guilty to $6M Investment Fraud

Published on: July 31, 2020 | by Shepherd Smith Edwards & Kantas, LLP

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.

Fired Ameriprise Broker Bryant Caveness is Accused of Stockbroker Fraud & Ethics Violation Allegations

Published on: July 30, 2020 | by Shepherd Smith Edwards & Kantas, LLP

FINRA Bars Former Registered Representative Following Probe Into Accusations

Bryant Edwin Caveness, an ex-Ameriprise Financial Services stockbroker, has been barred by the Financial Industry Regulatory Authority (FINRA) after he stopped cooperating in the self-regulatory organization (SRO)’s probe into his firing by the firm.

According to his Form U5 termination letter, the broker-dealer let him go last month because he violated company policies involving “personal trade, ethics, and solicitation of exchange-traded products” resulting in stockbroker fraud and misconduct.

First Western Capital Management Allegedly Placed Over $666M of Customers’ Money into Investments Reserved for Qualified Institutional Buyers

Published on: July 22, 2020 | by Shepherd Smith Edwards & Kantas, LLP

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.

Northwestern Mutual Investment Services Fined $350K for Inadequate Supervision of Ex-Broker Sampson Pearson

Published on: July 16, 2020 | by Shepherd Smith Edwards & Kantas, LLP

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.