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Articles Posted in Stockbroker Misconduct

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In our Silver Law securities arbitration and investment arbitration blogs, we highlight individuals who were caught taking financial advantage of their investment clients. In many cases, the investors are elderly, and sometimes, inexperienced at investing. And in some cases, the brokers and advisors are elderly themselves, caught committing fraud after a successful decades-long career. These individuals should understand what constitutes fraud, particularly against elderly clients. Still, they do it anyway. Many times, these elderly clients do not completely understand the complex investment information they are presented with. Some may be too polite to ask questions or challenge the representative. In other cases, they may be experiencing the beginnings of cognitive decline that isn’t  obvious and hasn’t yet been detected by family or their physician. This lapse in mental acuity can allow a fast-talking broker to convince them of something to which they would otherwise say “no.” The Increasing Elderly Demographic Although California has the largest number of elderly citizens, Florida has the highest percentage of elderly residents in the US. A full 19% of Florida’s population is over 65, and the numbers are increasing. It’s estimated that by 2050, elderly people in the US will top 80 million. Many of these elderly are financially well-off, and some are millionaires. A number of them will pass along their wealth to their children and grandchildren. These sums may be transferred more than once through parentage. So it’s highly likely that these elders can and will be targeted for fraud by any number of people. From distant family members who are suddenly friendly to caretakers, neighbors, brokers and financial advisors, and “new friends,” they all see an elderly person with money as an easy target.  In our Silver Law securities arbitration and investment arbitration blogs, we highlight individuals who were caught taking financial advantage of their investment clients. In many cases, the investors are elderly, and sometimes, inexperienced at investing. And in some cases, the brokers and advisors are elderly themselves, caught committing fraud after a successful decades-long career. These individuals should understand what constitutes fraud, particularly against elderly clients. Still, they do it anyway. Continue reading ›

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The SEC today filed a complaint and a request for jury trial involving claims against Knight Nguyen Investments of Katy, Texas, along with: Christopher Lopez, majority owner and “partner” Forrest Jones, investment advisor and “partner” Jayson Lopez, brother of Christopher and “partner” Although Christopher Lopez is not a registered broker, he was previously registered the SEC and the state of Texas for several years. The complaint alleges that Christopher Lopez and Forrest Jones represented themselves and the firm as experts in “low risk alternative investments.” However, the complaint explains, Chris Lopez had no experience with securities prior to founding Knight Nguyen, nor with the so-called “alternative investments.” Additionally, the investments did not meet the firms’ so-called investment “standards.”The SEC today filed a complaint and a request for jury trial involving claims against Knight Nguyen Investments of Katy, Texas, along with:

  • Christopher Lopez, majority owner and “partner”
  • Forrest Jones, investment advisor and “partner”
  • Jayson Lopez, brother of Christopher and “partner”

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Scott Reed (Scott Wayne Reed CRD# 3007033) is a previously registered broker and investment advisor whose most recent employer was First Financial Equity Corporation (CRD#: 16507). Prior to that, Reed spent four years at Wells Fargo Clearing Services, LLC (CRD#: 19616) in Scottsdale, Arizona. Reed has been in the securities industry since 1999. FINRA And Arizona Corporation Commission Investigate Scott Reed After learning of allegations concerning Reed following his termination from Wells Fargo, the Financial Industry Regulatory Authority (FINRA) began an investigation into Reed’s conduct.  Among other things, FINRA made the following findings of fact: Reed solicited individuals to invest in securities issued by a software and web development company based in Pasadena, California; Reed received selling compensation of $191,340 from the company for his role in soliciting and facilitating the investments; and Reed failed to provide Wells Fargo with prior notice or obtain the firm’s advance approval for his participation in these private securities transactions.Scott Reed (Scott Wayne Reed CRD# 3007033) is a previously registered broker and investment advisor whose most recent employer was First Financial Equity Corporation (CRD#: 16507). Prior to that, Reed spent four years at Wells Fargo Clearing Services, LLC (CRD#: 19616) in Scottsdale, Arizona. Reed has been in the securities industry since 1999. Continue reading ›

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Megurditch “Mike” Patatian (CRD# 4047060) is a former registered broker and investment advisor whose most recent employer was Supreme Alliance LLC (CRD#: 45348). Before that, Patatian spent seven years registered with Western International Securities, Inc. (CRD#: 39262) of Westlake Village, California. Patatian has been working in the industry since 1999. FINRA Department Of Enforcement Filed Disciplinary Proceeding Related To Patatian’s Securities Sales Practices FINRA’s Department of Enforcement filed a Complaint against Patatian on February 26, 2021. In the Complaint, FINRA alleged that from 2013 through 2017, Patatian recommended non-traded real estate investment trusts, or REITs, to dozens of customers. The investments purchased totaled $7.8 million, earning Patation more than $450,000 in commissions. The Complaint also details unsuitable and improper recommendations to surrender and/or switch annuities.Megurditch “Mike” Patatian (CRD# 4047060) is a former registered broker and investment advisor whose most recent employer was Supreme Alliance LLC (CRD#: 45348). Before that, Patatian spent seven years registered with Western International Securities, Inc. (CRD#: 39262) of Westlake Village, California. Patatian has been working in the industry since 1999. Continue reading ›

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Do you have a family member who is also your stockbroker, investment advisor, or other financial services representative? Many broker-dealer firms encourage newly-minted employees to recruit wealthy relatives to invest with them to begin their business and grow their client list. You may have taken the bait and moved your investments over, or may just be considering changing brokers to help them out. There isn’t anything wrong with doing this, of course, it’s your choice. In many ways, you should treat them as you would anyone you’re considering to invest your money, since it is your money that’s on the line. The goal is to ensure that your money will be in safe hands, and handled professionally, family or not.Do you have a family member who is also your stockbroker, investment advisor, or other financial services representative?

Many broker-dealer firms encourage newly-minted employees to recruit wealthy relatives to invest with them to begin their business and grow their client list. You may have taken the bait and moved your investments over, or may just be considering changing brokers to help them out. There isn’t anything wrong with doing this, of course, it’s your choice. Continue reading ›

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Christopher Black (CRD#5049080, aka Chris Bryan Black) is a former registered broker and investment advisor whose last known employer was LPL Financial LLC (CRD#:6413) of Statesboro, GA. His previous employers are Wells Fargo Clearing Services, LLC (CRD#:19616) of St. Simons Island, GA, State Farm V Management Corp. (CRD#:43036) of Bloomington, IL, and Linsco/Private Ledger Corp. (CRD#:6413) of Rome, GA. He has been in the industry since 2006. Christopher Black Disclosures Christopher Black is the subject of five disclosures, beginning with his discharge from LPL Financial on 3/30/2020. In the Form U5 submitted to FINRA on 4/30/2020, LPL stated that the firm terminated Black for entering into a loan agreement with a customer that he failed to disclose to the firm. Following his discharge from LPL, a customer filed a dispute on 4/17/2020 alleging that Black made an “unsuitable recommendation and purchase of bond investments with regard to risk tolerance and investment objective.”  The client requested damages of $72,044.00, and the firm settled the claim for $128,936.70.Christopher Black (CRD#5049080, aka Chris Bryan Black) is a former registered broker and investment advisor whose last known employer was LPL Financial LLC (CRD#:6413) of Statesboro, GA. His previous employers are Wells Fargo Clearing Services, LLC (CRD#:19616) of St. Simons Island, GA, State Farm V Management Corp. (CRD#:43036) of Bloomington, IL, and Linsco/Private Ledger Corp. (CRD#:6413) of Rome, GA. He has been in the industry since 2006. Continue reading ›

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Kevin Schaefer (Kevin Joseph Schaefer CRD:# 1286030) is a registered broke and investment advisor currently employed with Wells Fargo Clearing Services, LLC (CRD#: 19616) of San Francisco, CA. His previous employers include Morgan Stanley Smith Barney LLC (CRD#:149777) and UBS Financial Services Inc. (CRD#:8174), both of San Francisco, and Smith Barney Shearson Inc. (CRD#:7059) of New York, NY. He has been in the industry since 1984. Schaefer is the subject of two currently pending disputes. The first, filed on 6/12/2020, alleges “unsuitable investment recommendations and misrepresentations.” The client requests damages of $1,000,000. The second, filed on 6/4/2020, alleges “unsuitable investment recommendations, failure to follow instructions and misrepresentations from 2012 until 2020.”  The client requests damages of $300,000. Another previous dispute was settled. Filed 5/27/2008, the client alleges that the shares of stock that were purchased were supposed to be auction rate security bonds. The client requested damages of $5,000. Ultimately, the firm agreed to repurchase the ARS securities pursuant to an agreement with “several regulatory bodies.” Schaefer did not participate in the settlement.Kevin Schaefer (Kevin Joseph Schaefer CRD:# 1286030) is a registered broke and investment advisor currently employed with Wells Fargo Clearing Services, LLC (CRD#: 19616) of San Francisco, CA. His previous employers include Morgan Stanley Smith Barney LLC (CRD#:149777) and UBS Financial Services Inc. (CRD#:8174), both of San Francisco, and Smith Barney Shearson Inc. (CRD#:7059) of New York, NY. He has been in the industry since 1984. Continue reading ›

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Edward Dougherty (Edward Howard Dougherty/Ted Dougherty CRD# 2753847) is a registered broker and previously registered investment adviser currently registered with Woodbury Financial Services, In. in Bayfield, Wisconsin. Woodbury Financial has recently been the subject of arbitration claims alleging the unsuitable recommendation to purchase GPB Automotive and related investments. Edward Dougherty Disclosures Edward Dougherty has 4 disclosures on his publicly-available FINRA BrokerCheck report, including 2 financial, 1 employment separation after allegations, and 1 customer dispute:Edward Dougherty (Edward Howard Dougherty/Ted Dougherty CRD# 2753847) is a registered broker and previously registered investment adviser currently registered with Woodbury Financial Services, In. in Bayfield, Wisconsin. Woodbury Financial has recently been the subject of arbitration claims alleging the unsuitable recommendation to purchase GPB Automotive and related investments. Continue reading ›

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