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Articles Posted in Selling away

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In September, we told you about Morgan Stanley brokers James Polese and 29-year-old Cornelius Peterson, who were found guilty of financial charges ranging from conspiracy to aggravated identity theft. They have both been sentenced in the case.

How to Report Elder Financial Fraud on elderfinancialfraudattorneys.comJames Polese has been sentenced to 60 months (five years) in prison after pleading guilty to one count of conspiracy, one count of investment adviser fraud and eight counts of bank fraud as well as a charge of aggravated identity theft. The government originally requested 75 months, and the federal guidelines indicate a minimum sentence of 87 months. Polese’s attorney argued for a shorter sentence of 40 months.

Polese was ordered to pay $462,000 in restitution plus a $30,000 fine. After his release from prison, he will be supervised for three years. He will be restricted from working in financial services, and prohibited from drinking alcohol beyond a blood alcohol content (BAC) of 0.10. The judge recognized Polese’s work towards rehabilitation, which included speaking with two ministers who offered letters of support.

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Mitchell Alan Kurtz (CRD #2437746) is a former registered broker and investment advisor whose last employer was Henley & Company LLC (CRD #131453) of Roslyn Heights, NY. His previous employers are Raymond James Financial Services, Inc. (CRD #6694), also of Roslyn Heights, and Advest, Inc. (CRD #10) of Hartford, CT. He has been in the industry since 1994.

FINRA-Permanently-Bars-Barry-Hartman-From-Securities-Activity-for-Alleged-“Selling-Away”-Activities-300x209FINRA recently barred Kurtz “indefinitely,” effective 12/3/2018, after he declined to provide information requested in conjunction with an investigation. He is barred from any association with a FINRA member firm, and signed an Acceptance, Waiver & Consent (AWC) letter agreeing to the sanctions.

The investigation came after Kurtz was discharged from his last employer, Henley & Company on 7/30/2018. Kurtz violated both FINRA and SEC policies with regards to “outside business activities, selling away, fiduciary duty obligations, violation of professional standards and the Firm’s Code of Ethics.” This discharge led to the FINRA investigation, in which he declined to participate.

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Robin Michelle Wahby (CRD #2107629, aka, Robin Michelle Griswold) is a registered broker and investment advisor currently employed with NYLIFE Securities LLC (CRD #5167) of Jacksonville Beach, FL. She has been with NYLIFE since beginning in the industry in 1990.

FINRA-Permanently-Bars-Barry-Hartman-From-Securities-Activity-for-Alleged-“Selling-Away”-Activities-300x209Wahby has one disclosure in her record, filed on 6/12/018. A client who invested in Future Income Payments, LLC (“FIP”) on Wahby’s recommendation, filed this customer dispute. This investment was supposed to provide the client with a guaranteed fixed amount and protect the client’s investments. However, the client alleges, she has received no income and her funds were no longer available. The client requested damages of $39,460.00 and the case was settled for $40,000.

Future Income Payments and other high yield investments which claim not to be correlated to stock market returns have been the subject of many arbitration claims.  Investors generally do not appreciate the reasons why an investment may not appear on a monthly statement and some stockbrokers may be “selling away” from their firm.

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Ian Greenblatt (CRD #2276966, aka “Eric Green”) is a registered broker currently employed with Capitol Securities Management, Inc. (CRD #14169) of Melville, NY. His previous employers include Capitol Securities & Associates, Inc. (CRD #7278), Westrock Advisors, Inc. (CRD #114338, expelled by FINRA on 1/18/2011), both of Melville, NY and Weatherly Securities Corporation (CRD #11081), of New York, NY.  He has been in the industry since 1992.

FINRA-Permanently-Bars-Barry-Hartman-From-Securities-Activity-for-Alleged-“Selling-Away”-Activities-300x209FINRA recently suspended Greenblatt for 30 days after he attempted to settle a customer complaint away from the firm in March 2016. After two of his customers complained about the firm and the loss of $170,000 from their brokerage account, he failed to discuss this complaint with his firm. Greenblatt visited these customers and gave them $4,000 in cash and a check for $46,000 to their son, who is not a firm customer nor one of Greenblatt’s.

During the meeting, they allegedly discussed re-investing their funds to try and recover the losses they suffered with the firm by depositing the money with CSMI’s clearing firm. Unfortunately, Greenblatt was not able to recover their losses, and the customers filed for arbitration against Greenblatt in August of 2017.

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Dexter Leroy Thomas (CRD #1074222) is a formerly registered broker and investment advisor who was last employed with United Planners’ Financial Services Of America A Limited Partner (CRD #20804) of Dallas, TX. His previous employers include LPL Financial LLC (CRD #6413), National Planning Corporation (CRD #29604) and Invest Financial Corporation (CRD #12984), all of Dallas.  He began in the industry in 1983, and passed away on August 4, 2018.

FINRA-Permanently-Bars-Barry-Hartman-From-Securities-Activity-for-Alleged-“Selling-Away”-Activities-300x209Two days before his death, United Planners discharged Thomas after he revealed to the firm that he had engaged in “selling away,” privately borrowing money and making investment arrangements with several individuals outside of the firm’s auspices. Many of these individuals later became customers of United Planners. Thomas revealed that he conducted these transactions without notifying the firm, and the firm promptly terminated his employment.

The first of a total of fifteen claims was filed on 7/31/2018, just two days before his discharge from United Planners. The last claim was filed on 9/23/2018. These claims alleged either “unsuitable investments” or detailing monies borrowed but not returned without the firm’s knowledge or approval. Of the fifteen claims listed in BrokerCheck, eight request financial damages from $22,000 to $8.1 million, for a total of $9,260,000. These claims are all listed as “pending.”

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South-Florida-Broker-Brian-Michael-Berger-Permanently-Barred-by-FINRA-1024x683-300x200Dennis Farrah (CRD #2703960) is a former registered broker and investment advisor whose last employer was Taylor Capital Management Inc. (CRD #43559) of Aurora, CO. His previous employers include Sicor Securities Inc (CRD #16195); expelled by FINRA on 01/31/2014), also of Aurora, Questar Capital Corporation (CRD #43100) of Centennial, CO and Lifemark Securities Corp. (CRD #16204) of Rochester, NY. No current employment information is available. He has been in the industry since 1996.

Farrah submitted his resignation on 12/08/2017, and Taylor Capital notified FINRA by filing a U5 form, standard for registration terminations. Farrah voluntarily resigned after allegations. However, Taylor Capital amended the U5 on 1/23/2018, notifying FINRA that the state of Colorado was planning to file fraud charges for selling away without the firm’s knowledge or approval. His license was revoked by the state on 01/31/2018. On 07/12/2018, criminal charges of securities fraud were filed against Farrah.

Previously, Farrah declined to respond to FINRA’s request for information in the matter, and signed a letter of Acceptance, Waiver & Consent (AWC). FINRA barred Farrah effective 6/18/2018. In it, he neither admitted nor denied the charges, and agreed to the sanctions, which included an indefinite bar in all capacities.

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South-Florida-Broker-Brian-Michael-Berger-Permanently-Barred-by-FINRA-1024x683-300x200Bradley Joseph Tennison (CRD #1561988) is a former registered broker and investment advisor who has recently been barred by FINRA. He was last registered with Genos Wealth Management of Mesa, AZ. He was previously employed with Oberlin Financial Corp. (CRD #103717) of Bryan, OH, First Allied Securities, Inc. (CRD #32444) of San Diego, CA, and D.E. Frey & Company, Inc. (CRD #23595) of Denver, CO. No current employment information is available. He has been in the industry since 1989.

Tennison has six disclosures, three of which are related to a client dispute that is currently pending. On 4/24/2018, a former firm client contacted Genos Wealth with a written complaint requesting assistance with a $300,000 investment Tennison recommended, called “The Joseph Project.” The letter alleges no statements were ever issued, and she was unsuccessful in getting her capital back or any of the promised returns. The client was told by Tennison that it was a 12 month “investment” with a 5% enhancement. She wired the $300K from her bank directly to where Tennison instructed her.

Upon examination, it was discovered that this “investment opportunity” was not something recommended or offered by the firm, and there were no records available. Tennison was “minimally responsive” to the firm’s request for information.  On 4/25/2018, Genos Wealth discharged Tennison after he admitted that the former client’s money was wired to a third party that wasn’t investment related.

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Frank Howard Zito (CRD #2766336) is a former registered broker and investment advisor. He was most recently registered with Merrill Lynch, Pierce, Fenner & Smith Incorporated (CRD #7691) of Ridgeland, MS. He was previously registered with Morgan Keegan & Company, Inc. (CRD #4161) and Amsouth Investment Services, Inc. (CRD #15692), both of Jackson, MS. He began in the industry in 1996.

Former-New-York-Life-Broker-Jonathan-Williams-Barred-by-FINRA-as-a-Result-of-Outside-Business-Activities-300x200Zito is the subject of three disclosures. He was discharged by Merrill Lynch on 6/25/2018 for “Conduct including failure to adhere to Firm standards regarding selling away and failure to fully disclose participation in an outside business activity.”  (“Selling away” is when a broker sells securities that are not being offered by the brokerage firm they are working for. This is a violation of securities regulations.)

The discharge follows a customer dispute filed on 5/18/2018 with allegations of selling away, as well as unsuitable investment recommendations from 2013 until January 2018. The customer is requesting damages of $571,000.00. This dispute is currently pending.

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Larry Joe Templin (CRD #2440316) is a former broker and investment advisor who was last registered with Centaurus Financial, Inc. (CRD #30833) of Temple, TX. He was previously registered as a broker with Usallianz Securities, Inc. (CRD #40875), also of Temple, and 1st Global Capital Corp. (CRD #30349) of Dallas, TX. He has been in the industry since 1997.

FINRA-Permanently-Bars-Barry-Hartman-From-Securities-Activity-for-Alleged-“Selling-Away”-Activities-300x209Templin was discharged on 05/31/2018 by Centaurus Financial after allegations of bank fraud. He was employed by Centaurus since 09/2006.

Templin has also disclosed outside business affiliations to FINRA, including Mathews, Ludwick, Templin & Montgomery (tax preparation) and Structured Associates of Texas (non-investment related) and Flagstone Advisors of Temple (as “employer history,” since 1/2002.)

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Howard Raymond Utz (CRD #2672208) is a former broker whose last registered employer was Hazard & Siegel, Inc. (CRD #2048) of Mars, PA, from 09/24/2015 through 06/01/2018. His previous employers include Securities America, Inc. (CRD #10205) and Sunset Financial Services, Inc. (CRD #3538), both of Mars, PA. No current employment information is available. He has been in the industry since 1995.

Former-New-York-Life-Broker-Jonathan-Williams-Barred-by-FINRA-as-a-Result-of-Outside-Business-Activities-300x200Utz was discharged on 6/1/2018 from Hazard & Siegel as a result of allegations that he failed to report outside business activities and private security transactions. It was also alleged that Utz accepted and received checks in his own name and converted them to personal use. No other information is available from this disclosure.

Two additional disclosures indicating an investigation are also in his record. The first, filed on 05/25/2018, indicate that the FBI is conducting an investigation into Utz’s activities. However, no additional information is available. The second, filed on 01/30/2018, indicate the SEC was also conducting an investigation, but again, no additional information is listed nor available.

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