Stockbroker Misconduct

Silver Law Group is Investigating Kimberly Kitts of Royal Alliance Associates

May 1, 2018 | Silver Law Group

Kimberly Kitts (CRD# 2768200) has been with Royal Alliance Associates in Palmer, Massachusetts since 2004. In a regulatory action from 2017, FINRA found that Kitts failed to respond to a FINRA request for information. Kitts also failed to request termination of her earlier suspension within the allotted time. As a result, FINRA permanently barred Kitts from being associated with any FINRA member firm. Kitts was also discharged from Royal Alliance Associates in 2017. The firm terminated Kitts after receiving correspondence from her client’s attorney alleging that Kitts converted or misappropriated the client’s funds.

Kitts has also been the subject of several customer disputes. In one dispute pending from 2017, the Claimant also alleges that Kitts converted or misappropriated the Claimant’s funds. In addition to this claim, Kitts has three other complaints against her that eventually were closed or dismissed. These complaints included allegations such as unsuitability and non-compliance with client requests.

FINRA requires that its members refrain from engaging in fraudulent or deceptive practices with their clients. FINRA also requires its members to only charge their clients a reasonable fee for services.

Silver Law Group is Investigating Kevin Graetz of Paulson Investment Company

May 1, 2018 | Silver Law Group

Kevin Graetz (CRD# 1935982) has been with Paulson Investment Company since 2013. In a regulatory action from 2016, FINRA found that Graetz willfully failed to timely disclose tax liens against him. Graetz owes over $1,000,000 in unpaid taxes to both the IRS and the State of Connecticut. As a result of this violation, FINRA fined Graetz $10,000 and suspended him for six months. In a separate regulatory action from 2017, FINRA found that Graetz failed to respond to a FINRA request for information. Graetz also failed to request termination of his earlier suspension within the allotted time. FINRA permanently barred Graetz from being associated with any FINRA member firm due to this violation.

Graetz has also been the subject of several customer disputes. In one pending dispute from 2017, the customer alleges fraud and unjust enrichment in connection with the sale of promissory notes; the customer alleges damages of $1,000,000. Graetz was ultimately terminated from Paulson Investment Company as a result of this customer complaint. In a settled complaint from 2005, the customer alleged that Graetz purchased an unsuitably large amount of stock in his account. In another settled complaint from 2003, a customer alleged that Graetz generally mishandled the customer’s account; the case settled for $75,000.

FINRA requires its members to “have a reasonable basis to believe that a recommended transaction or investment strategy” is suitable for a customer given their individual needs. FINRA also requires its members to “observe high standards of commercial honor and just and equitable principles of trade.”

Silver Law Group is Investigating Minish Joe Hede of Paulson Investment Company

May 1, 2018 | Silver Law Group

Minish Joe Hede (CRD# 2389098) has been with Paulson Investment Company since 2013. In a regulatory action from 2017, FINRA found that Hede failed to respond to a FINRA request for information. Hede also failed to request termination of his earlier suspension within the allotted time. As a result, FINRA permanently barred Hede from being associated with any FINRA member firm. Hede was also discharged from Paulson Investment Company in 2017. The firm terminated Hede after a customer filed a complaint alleging negligence, fraud, and unjust enrichment. The firm also stated that Hede failed to comply with its internal investigation into the matter.

Hede has also been the subject of several customer disputes. In one dispute pending from 2017, the Claimant alleges fraud and unjust enrichment in connection with the sale of promissory notes; the Claimant alleges damages of $1,000,000. In another complaint from 1999, the Claimant alleged unauthorized use of margin trading by Hede. The case settled for over $6,000.

FINRA requires its members to “have a reasonable basis to believe that a recommended transaction or investment strategy” is suitable for a customer given their individual needs. FINRA also requires that its members refrain from engaging in fraudulent or deceptive practices with their customers.

Silver Law Group is Investigating Benjamin Aibel of Wunderlich Securities

May 1, 2018 | Silver Law Group

Benjamin Aibel (CRD# 1994) has been with the Memphis, Tennessee branch of Wunderlich Securities since 2012. In a regulatory action from 2017, FINRA found that Aibel failed to respond to a FINRA request for information. Aibel also failed to request termination of his earlier suspension within the allotted time. As a result, FINRA permanently barred Aibel from being associated with any FINRA member firm.

In addition to this regulatory action, Aibel has also been the subject of several customer disputes. In one dispute settled in 2016, the Claimant alleged over $600,000 in damages stemming from Aibel’s breach of fiduciary duty, negligence, unauthorized trading, and unsuitable recommendations. In three different customer disputes from 2002, the Claimants all alleged that Aibel misrepresented a corporate bond to Claimants; each claim occurred while Aibel was employed by Salomon Smith Barney, Inc. In a final claim from 2002, the Claimant alleged that Aibel provided unsuitable recommendations and engaged in churning in Claimant’s account; that claim settled for over $80,000.

FINRA requires its members to “have a reasonable basis to believe that a recommended transaction or investment strategy” is suitable for a customer given their individual needs. FINRA also requires that its members refrain from engaging in fraudulent or deceptive practices with their customers.

FINRA Bans Broker Michael Alan Siegel After Repeated Complaints and Investigations

April 27, 2018 | Silver Law Group

FINRA has barred Michael Alan Siegel (CRD# 1950871) from “acting as a broker or otherwise associating with a broker-dealer firm.” Siegel was a previously registered broker and investment advisor and worked in the financial services industry since 1992. His last registered place of employment was with National Securities Corporation of Edison, NJ (CRD# 7569), from 04/21/2014 through 05/13/2016

Siegel’s previous work history includes 13 investment companies:

Concorde Investment Services (CRD# 151604), in Parsippany, NJ from 09/19/2013 through 04/22/2014

Discharged Morgan Stanley Broker Charles Albert Dixon Is Permanently Barred By FINRA

April 27, 2018 | Silver Law Group

Former broker Charles Albert Dixon, Jr. (CRD# 1660422) has been permanently barred by FINRA after a disciplinary action that was signed and completed on 1/22/2018. He is no longer allowed to work as a broker, associate with another broker or be affiliated with a broker-dealer firm. Dixon was discharged by his employer, Morgan Stanley Smith Barney, LLC (CRD#149777) of Houston, TX. He was registered with Morgan Stanley from 06/01/2009 to 04/17/2017.

Dixon was previously registered as a broker with:

Morgan Stanley & Company, Incorporated (CRD# 8209), Houston, TX, from 04/02/2007 to 06/01/2009

Colorado Investigates California-Based Peter Gerhard Klaas For High Risk Trading, Seeking License Revocation

April 13, 2018 | Silver Law Group

Peter Gerhard Klaas (CRD# 2381681) is currently registered as a broker and investment advisor, and is employed at El Segundo, CA-based Cetera Advisor Networks since 05/2017. He is registered with Cetera in both Murray, UT and Las Vegas, NV, and licensed in Arizona, Idaho, Nevada and Utah.

Klaas was previously employed with Allegis Investment Services (05/2014-03/2017,) Signator Financial Services (04/2011-06/2014), and LPL Financial (09-2007-05/2011.)

The Colorado Division of Securities is currently investigating broker Klaas for along with broker Heath Bowen (CRD# 4824684) for putting advisory clients in high-risk and complex option trades that said clients didn’t understand. CDS is not requesting monetary damages in this pending investigation, but is asking for the revocation of Klaas’ licensure. This investigation began while Klaas was employed with Allegis.

Silver Law Group is Investigating Gary Adkin of Stifel, Nicolaus & Company

April 6, 2018 | Silver Law Group

Gary Adkin (CRD# 3084484) is the subject of a pending customer dispute alleging $1,550,000 in damages. Adkin has been with the Palm Beach, Florida office of Stifel, Nicolaus & Company since 2015. He was previously registered with Barclays Capital, also located in Palm Beach. Silver Law Group is a South Florida-based law firm that handles securities arbitration and investment fraud cases.

In the pending dispute, Claimants allege that Adkin was negligent and failed to exercise responsibility in connection with their account. FINRA requires its members to “have a reasonable basis to believe that a recommended transaction or investment strategy” is suitable for a customer given their individual needs.

Contact Our Firm if You’ve Invested with Gary Adkin

SEC Investigation Of Morgan Stanley And Puerto Rico Bond Investments

April 6, 2018 | Silver Law Group

When Hurricane Maria landed in Puerto Rico, it caused devastation to the island’s infrastructure, crops, homes and power grid that will take many years to repair. But the damages to Puerto Rico include losses in municipal bonds and the mutual funds that hold them, which were close to default even before the storm.

While the island still struggles to recover, it wasn’t the first catastrophic event to hit the island territory. In 2014, Puerto Rico was already headed for a severe financial crisis, with bond sales from Morgan Stanley brokers as the catalysts.

Morgan Stanley and Barclay’s were responsible for underwriting the island’s $3.5 billion sale in March 2014. This sale was the last major issue by Puerto Rico before declaring bankruptcy on May 3, 2017, for a debt restructuring amounting to $3.8 trillion. The island’s debt stood at $70 million, and it needed to restructure pensions of $49 million. This municipal bankruptcy was even bigger than the city of Detroit’s 2013 restructuring of $18 billion.

Silver Law Group is Investigating Christopher Bennett of Hilliard Lyons

March 6, 2018 | Silver Law Group

A Financial Industry Regulatory Authority (FINRA) arbitration panel awarded a customer of Christopher Bennett of Hillard Lyons damages of $445,000 after the claimant alleged Bennett engaged in breach of fiduciary duty, unauthorized trading, suitability, churning, misrepresentation, omission of facts, common law negligence, fraud, failure to supervise, common law negligent supervision and violation of Kentucky statutes, regulations and FINRA rules. The causes of action related to losses to the client’s qualified and non-qualified retirement accounts. The investor alleges Mr. Bennett executed transactions in her accounts without authorization, allocated her assets in an unsuitable manner for someone her age and with her investment objectives without discussing the risk associated with such re-allocation, and engaged in excessive trading in her accounts. A brokerage firm has a duty to supervise a stockbroker for compliance with the securities laws and internal firm rules and regulations.

Christopher Duke Bennett is currently registered with J.J.B. Hilliard, W.L. Lyons in Louisville, Kentucky, and has been since December 1995. He has six customer disputes against him, three of which are currently pending.

Contact Our Firm if You’ve Invested with Christopher Bennett