Securities Arbitration Lawyers Blog

FINRA’s Failure to Supervise Rule

June 8, 2018 | Silver Law Group

Financial Industry Regulatory Authority (“FINRA”) is the non-governmental organization that regulates stockbrokers and brokerage firms. FINRA rules set out the appropriate conduct for its members. This includes several rules detailing member firms’ requirement to supervise their brokers and advisers.

FINRA Rule 3110 is the main rule discussing supervision. It requires firms to “establish and maintain a system to supervise the activities of each associated person that is reasonably designed to achieve compliance” with both FINRA rules and state or federal securities laws. FINRA requires these procedures to be in written form. A copy of the procedures must be kept in every location where supervisory activities are conducted.

Once a brokerage firm establishes a supervisory system, it must routinely check that the system works properly. To ensure this, FINRA requires firms to assign a qualified principal to each registered person at the firm. The principal is responsible for supervising the registered person’s actions.

Securities Regulatory Authorities Were Well Aware of Problems with Wedbush Securities

June 8, 2018 | Silver Law Group

Wedbush Securities is facing discipline from the SEC, NYSE, and FINRA for a manipulative trading scheme involving its founder, Edward Wedbush. According to a recent article by InvestmentNews.com, however, all three agencies were well aware of problems within Wedbush for many years, but handed down no real, meaningful punishment to the firm. This allowed Mr. Wedbush to continue his scheme for years, hurting many investors along the way.

The complaint filed by the NYSE details a history of Wedbush’s run-ins with the three agencies. In 2015, Wedbush was fined by both the SEC and NYSE for “extensive and widespread supervisory deficiencies,” among other things. Before 2015, the firm “was fined over $2,000,000 by regulators in more than a dozen separate actions involving supervisory failures.”

The NYSE and FINRA’s Department of Market Regulation also conducted an investigation of Wedbush concerning violations of supervisory obligations, books and records keeping, trade mismarking, and other issues. FINRA then referred the investigation to its Legal Section of FINRA Market Regulation; NYSE finally took over the investigation in 2016. This extensive regulatory history shows that all three agencies were on notice of Wedbush’s repeated supervisory failures.

5 Common Financial Scams Aimed at Seniors

June 6, 2018 | Silver Law Group

Educate yourself so you can protect yourself or your loved ones

While the health of your senior loved ones might be the main thing you focus on, there are other areas you can’t ignore, such as their finances. Just as you want to ensure that they are safe when driving, traveling, etc., you need to do the same for their money.

Unfortunately, older people are preyed upon all the time by scammers and con artists, and research shows that due to diminished capacity or simply higher levels of trust, they often make for easier targets. Here are some of the most common schemes to know about:

A New SEC Proposal Aims to Protect Investors

June 5, 2018 | Silver Law Group

The Commission proposes new regulations for financial advisors and dealer-brokers to avoid conflict of interest

While the Department of Labor (DOL) passed a fiduciary rule governing investment advice to retirees in 2016, a federal appeals court struck it down in its entirety in March of this year.

Considered by its advocates to be a positive step in protecting the rights of the elderly, the rule declared that brokers had to agree to a Best Interests Contract (BIC) agreement with their clients before being allowed to earn commissions and other forms of compensation.

Silver Law Group Reminds Shareholders with Investments Losses in Cancer Genetics, Inc. of Class Action Lawsuit and Upcoming Deadline – CGIX

June 4, 2018 | Silver Law Group

Silver Law Group announces that a class action lawsuit has been filed against Cancer Genetics, Inc. (“Cancer Genetics” or the “Company”) (CGIX) and certain of its officers. The class action, filed in United States District Court, District of New Jersey, and docketed under 18-cv-06353, is on behalf of a class consisting of investors who purchased or otherwise acquired Cancer Genetics securities between March 23, 2017 through April 2, 2018, both dates inclusive (the “Class Period”), seeking to recover damages caused by defendants’ violations of the federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated thereunder, against the Company and certain of its top officials.

If you are a shareholder who purchased Cancer Genetics securities between March 23, 2017, and April 2, 2018, both dates inclusive, you have until June 4, 2018, to ask the Court to appoint you as Lead Plaintiff for the class. To discuss this action, contact Scott L. Silver at ssilver@silverlaw.com or (800) 975-4345 toll-free. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and the number of shares purchased.

Cancer Genetics is a diagnostics company focused on the development and commercialization of proprietary genomic tests and services to improve the diagnosis, prognosis, and response to treatment (theranosis) of cancer. Cancer Genetics went public in 2013 raising approximately $6,000,000. The lead underwriters were Aegis Capital Group and Feltl & Company, Inc.

Individuals Barred by FINRA in May 2018 for Failing to Comply with FINRA Rules

June 4, 2018 | Silver Law Group

According to FINRA Disciplinary actions for May 2018, the following individuals were barred from FINRA and cannot currently work for a FINRA brokerage firm for failing to provide FINRA with information it requested or to keep information current with FINRA pursuant to FINRA rules:

NAME	FORMER EMPLOYERS
Benjamin Glasser Aibel	Wunderlich Securities,Inc
Benjamin Glasser Aibel	Sanders Morris Harris Inc
Carter Page Brooks	Wells Fargo Clearing Services, LLC
Carter Page Brooks	Edward Jones
Walter Lee Clark	Wilmington Capital Securities, LLC
Walter Lee Clark	Adirondack Trading Groups LLC
Christian Colon	Ausdal Financial Partners, Inc.
Christian Colon	UBS Financial Services Inc.
Randolph Lee Eddlemon III	Geneos Wealth Management, Inc.
Randolph Lee Eddlemon III	Schooner Financial Associates
Carlos Nestor Evertsz-Seda	K.C. Ward Financial
Carlos Nestor Evertsz-Seda	J.P. Turner & Company, LLC
Kenneth Taylor Foreman	Securities America, Inc
Kenneth Taylor Foreman	Foothill Securities, Inc
Sherie Irene Gaunt	Gill Capital Partners
Kimberly Pine Kitts	Royal Alliance Associates, Inc
Kimberly Pine Kitts	Sound Financial, LLC
Peter Jack Margaros	State Farm VP Management Corp
James Albert Pettit	Ameriprise Financial Services, Inc
James Albert Pettit	Janney Montgomery Scott LLC
Keisha Diane Pizzo
Eric P. Poage	Edward Jones
Eric P. Poage	Lincoln Financial Advisors Corporation
John Greg Schmidt	Wells Fargo Advisors Financial Network, LLC
John Greg Schmidt	Stifel, Nicholas & Company, Inc
Bradley Curtis Williams	J.P. Morgan Securities LLC
Bradley Curtis Williams	Invest Financial Corporation
Luis Alberto Zuniga

Silver Law Group represents investors in securities and investment fraud cases through FINRA arbitration or court. Our lawyers are admitted to practice in New York and Florida and represent investors nationwide in securities arbitration to help recover investment losses due to stockbroker misconduct. If you have any questions about how your account has been handled, call to speak with an experienced securities attorney. Most cases handled on a contingent fee basis meaning that you do not pay legal fees unless we are successful.

May 2018 Disciplinary Actions from FINRA Name Individuals Suspended for Failing to Comply with FINRA Rules

June 4, 2018 | Silver Law Group

According to FINRA Disciplinary actions for May 2018, the following individuals were suspended from FINRA for failing to comply with a FINRA arbitration award or settlement agreement pursuant to FINRA rules:

NAME	FORMER EMPLOYERS
Lawrence Joseph Alfano	Blackbook Capital LLC
	EKN Financial Services INC
Terry Dean Bahgat	Gradient Securities, LLC
	Cambridge Investment Research, Inc
Matthew Wayne Bailey	Wells Fargo Advisors, LLC
	Edward Jones
Christopher John Calandrino	Joseph Stone Capital L.L.C.
	National Securities Corp.
Richard Grant Cody	IFS Securities
	Concorde Investment Services, LLC
Barry Franklin Connell	Morgan Stanley
James Fillmore Crawford Jr.	Concorde Investment Services, LLC
	Independent Financial Group, LLC
Rick Douglas Konency	National Securities Corporation
	J.P. Morgan Securities LLC
Jonathan Richard Lake	Morgan Stanley
	Wells Fargo Clearing Services LLC
Maroof Miyana	Legend Securities, Inc
	IAA Financial LLC
Roberto Montano	Waddell & Reed
	U.S. Bancorp Investments, Inc
Michael Jay Novick	Morgan Stanley
	Beverly Hills Wealth Management, LLC
David Warren Olson	Morgan Stanley
	Merrill Lynch, Pierce, Fenner & Smith Inc
Jason Charles Parker	LPL Financial LLC
	Edward Jones
James Albert Pettit	Ameriprise Financial Services, Inc
	Janney Montgomery Scott LLC
Jose Aloisio Teles	Nomura Securities International, Inc
	Standard Chartered Bank
Jacques Tizabi	Astor Capital, Inc
	Round Hill Securities, Inc
Christopher Thomas Tolmacs	Triad Advisors, Inc.
	Harbinger Asset Management, LLC
Bhaskar Chandrakant Vyas	Interfirst Capital Corporation
	Western International Securities, Inc
Mark Edward Winburne	MML Investors Services, LLC
	Metlife Securities, Inc.

Silver Law Group represents investors in securities and investment fraud cases through FINRA arbitration or court. Our lawyers are admitted to practice in New York and Florida and represent investors nationwide in securities arbitration to help recover investment losses due to stockbroker misconduct. If you have any questions about how your account has been handled, call to speak with an experienced securities attorney. Most cases handled on a contingent fee basis meaning that you do not pay legal fees unless we are successful.

FINRA Suspends Registered Individuals in May 2018 for Violations of FINRA Rules

June 4, 2018 | Silver Law Group

According to FINRA Disciplinary actions for May 2018, the following individuals were suspended from FINRA and cannot currently work for a FINRA brokerage firm for failing to provide FINRA with information it requested or to keep information current with FINRA pursuant to FINRA rules:

NAME	FORMER EMPLOYERS
Fernando Enrique Acosta
Paul Anthony Bustamante	Empire Asset Management Company
Paul Anthony Bustamante	Bishop, Rosen & Co, Inc
Janna L. Carruth-Vogler
Abel Chavez	Farmers Financial Solutions, LLC
Thomas Matthew Dunlap	AXA Advisors, LLC
Saima Ashraf Durrani	J.P. Morgan Securities LLC
Saima Ashraf Durrani	Chase Investment Services Corp
Joshua David Ellis	LPL Financial LLC
Joshua David Ellis	BCG Securities, Inc.
Ashley Evans
Samual LaWayne Haddix	Ameriprise Financial Services, Inc.
Samual LaWayne Haddix	IDS Life Insurance Company
Christopher Lee Hibbard	Merrill Lynch, Pierce, Fenner & Smith Inc
Christopher Lee Hibbard	Bank of America, NA
Shawn I Houslin	Merrill Lynch, Pierce, Fenner & Smith Inc
Shawn I Houslin	Bank of America, NA
Michael Dennis Jackson	Securities America, Inc
Michael Dennis Jackson	Brecek & Young Advisors, Inc.
Valbona Keja Keja-Dasilva	Suntrust Investment Services, Inc
Valbona Keja Keja-Dasilva	CCO Investment Services Corp
Shane Jason Kelly	LPL Financial LLC
Shane Jason Kelly	Atlantic Capital Advisors
Keesang John Kim	MML Investors Services, LLC
Keesang John Kim	Pruco Securities, LLC
Michael Ray Matos	J.P. Morgan Securities LLC
Uriah Eli Mitchell	J.P. Morgan Securities LLC
Michael Patrick Nanto	J.P. Morgan Securities LLC
Michael Patrick Nanto	Mutual of Omaha Investor Services, Inc.
Frederick Lamar Pearse	J.P. Morgan Securities LLC
Anteneh A. Roberts	Merrill Lynch, Pierce, Fenner & Smith Inc
Anteneh A. Roberts	Bank of America, N.A.
Jeanette Marie Sanchez

Silver Law Group represents investors in securities and investment fraud cases through FINRA arbitration or court. Our lawyers are admitted to practice in New York and Florida and represent investors nationwide in securities arbitration to help recover investment losses due to stockbroker misconduct. If you have any questions about how your account has been handled, call to speak with an experienced securities attorney. Most cases handled on a contingent fee basis meaning that you do not pay legal fees

Coastal Equities Broker Luke Johnson Under Investigation for Unsuitable Non-traded REIT Recommendations

June 1, 2018 | Silver Law Group

Silver Law Group is investigating Wilmington, Delaware-based Coastal Equities, Inc. (CRD# 23769) broker Luke Johnson (CRD# 461987) for unsuitable recommendations in non-traded REITs, annuities and other illiquid investments.

In August 2017, a Coastal Equities customer filed a FINRA arbitration alleging that Johnson recommended unsuitable securities purchased in approximately 2015. The FINRA arbitration complaint alleges $56,000 in damages. In 2005, Johnson’s previous firm permitted Johnson to resign after he admitted that he signed the name of his office’s designated supervisor on four (4) variable life insurance application forms which indicated an acceptable suitability review by the supervisor.

Johnson operates under the name Legend Capital Group Inc. As part of his business under Legend Capital Group, he sells fixed insurance and annuity products for various insurance companies, according to his FINRA BrokerCheck report. He is also an investment advisor with Coastal Equities.

Royal Alliance Associates Arbitration Lawyer

June 1, 2018 | Silver Law Group

The recent arrest of former broker Gary Basralian (CRD #14385) for defrauding two clients of $2.1 million also raises allegations of failure to supervise about his brokerage firm, Royal Alliance Associates (CRD #23131.) According to news reports, Basralian embezzled money from two elderly women and used the funds for his own expenses. When the discrepancies were discovered, the elderly victims’ attorney notified both the FBI and DOJ. Both agencies took immediate action, and Basralian was arrested May 23, 2018 on charges of wire and investment adviser fraud. He could face as much as 25 years in prison.

The stockbroker in question allegedly deliberately sought out vulnerable victims who might not notice that he was stealing funds directly from their accounts. Basralian is, himself, 70 years of age—so he likely embezzled from his contemporaries. When the law firm representing the two victims contacted Royal Alliance, Basralian was not immediately terminated, but allowed to resign. He signed a FINRA agreement and was barred from being a broker or affiliated with any broker firms.

But what about the brokerage firm, Royal Alliance, that failed to stop him? And why didn’t Royal Alliance notice or stop Basralian’s unethical activities over a ten-year period? Allegations against Royal Alliance in this case include inadequate supervision of brokers and lax anti-money laundering compliance that allowed this to not only happen, but continue. But this is not the first time Royal Alliance has been host to broker misbehavior, with several instances of “failure to supervise” kinds of sanctions.