Articles Tagged with Newbridge Securities

SSEK Law Firm investigates Martin David Batstone and Newbridge Securities Corp.

Shepherd, Smith, Edwards & Kantas (“SSEK Law Firm”), a law firm specializing in representing wronged investors, is looking into allegations against Martin David Batstone, formerly employed by Newbridge Securities Corp. out of San Diego, California. Prior to that he worked at Crown Capital Securities and Independent Financial Group, LLC.  According to allegations, Batstone used his position as a financial advisor to solicit investments in an outside business activity.  It is unclear if this outside operation was approved by Newbridge Securities or his prior employers. It is further alleged Batstone utilized a portion of the funds for his own use.  The practice of soliciting firm clients to invest in outside business activities is referred to as “selling away” and is prohibited by most firms.  Often times it turns out these unapproved outside investments are controlled by the financial advisor, or at the very least there is renumeration of some sort.

Perhaps due to the above conduct, Batstone is no longer in the business.  However, a formal complaint has been filed by The Financial Industry Regulatory Authority Inc. (FINRA) against Batstone. Therein it is alleged that Batstone solicited $75,000 from clients to invest in a small limited liability company which claimed to provide brand management and product placement services for entertainers and athletes.  According to the complaint, the company was owned by a former rapper and DJ.  Batstone claimed in his sales pitch that the proceeds would be used for operating expenses and marketing of a sports energy drink.  At some point in time, it is alleged, that Batstone transferred some assets to his personal bank account.  The complaint further states that Batstone never advised his clients of that fact.  The FINRA complaint is still pending.

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. 

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In March 2019, Newbridge Securities Corporation (“Newbridge”) filed its Form X-17A-5, commonly called a firm’s Focus Report, with the Securities & Exchange Commission (“SEC”).  The Focus Report showed that in 2018, Newbridge had almost $33 million in revenues, yet reported only about $108,000 in net profits.

The accounting firm that audited Newbridge disclosed in its “Opinion on the Financial Statements” that “there is substantial doubt about [Newbridge’s] ability to continue as a going concern.”  This means that the finding from the CPA firm of Newbridge in financial trouble means investors that hold accounts with the firm should be concerned.

Newbridge is a Boca Raton, Florida based brokerage and financial services firm.  Although the firm claims to have “over 80 locations in the US”, its website only lists offices in Boca Raton, Ft. Lauderdale, Scottsdale, Chicago and a few locations in New York.

The Financial Industry Regulatory Authority (FINRA) has suspended David Howard Fagenson, a former UBS Financial Services (UBS) broker, for eight months. Fagenson, now registered with Newbridge Securities, is accused of unsuitable trading in the accounts of three older clients.

The allegedly excessive trades are said to have created significant losses for the UBS customers, even as Fagenson and the brokerage firm made hundreds of thousands of dollars in commissions and markups for the same transactions. The settlement between the self-regulatory authority (SRO) and the ex-UBS broker states that the trading violations took place between January 2012 and September 2016.

FINRA said that the senior investors that the ex-UBS broker harmed included a 95-year-old widow with an over $5M net worth who had numerous accounts at the firm. While her brokerage account purportedly lost $283K during the period at issue, she paid $260K in markups and commissions.

Ex-Newbridge Securities Broker Involved in $131M Fraud Pleads Guilty 
Gerald Cocuzzo, has pleaded guilty to securities fraud related to his involvement in a $131M market manipulation scam involving Forcefield Energy Inc. (FNRG). According to the U.S. Justice Department, between 1/2009 and 4/2015, Cocuzzo and others sought to bilk investors in the publicly traded company that globally distributes and provides LED lighting products. They did this by artificially manipulating the volume and price of the shares that were traded.

Meantime, Cocuzzo received kickbacks for buying Forcefield stock in his clients’ brokerage accounts. He did not tell the customers that he was receiving these payments. Instead, he and several others sought to hide their involvement.

Newbridge Securities fired Cocuzzo earlier this year following the federal indictment. Before working at Newbridge, he was registered with IAA Financial, previously called CBG Financial Group Inc.

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