$70 MILLION Recovery for Investment Fraud

$44 MILLION Recovery for Ponzi Scheme Victims

$25 MILLION Recovery Against National Brokerage Firm

$9.1 MILLION FINRA Arbitration Award Against Brokerage Firm

$7.9 MILLION Securities Arbitration Award Against Stockbroker

$1 MILLION Securities Arbitration Award for Elder Financial Fraud

Securities Arbitration Lawyers Blog

FINRA Accuses Broker of Losing $8 Million Investing in ETFs

November 29, 2016 | Silver Law Group

The Financial Industry Regulatory Authority (“FINRA”) has filed a case against Richard William Lunn Martin (“Martin”) (CRD# 723309) for allegedly recommending clients invest in unsuitable non-traditional exchange traded funds (“non-traditional ETFs”).

Martin has been employed by G.F. Investment Services, LLC (CRD# 132939) from April 2014 to July 2015 and between July 2009 and April 2014. Between martin’s two stints at G.F. Investment Services, he was employed by Global Strategic Investments, LLC (CRD# 117028). At both brokerage firms, Martin was based out of Miami, Florida.

According to the complaint, Martin claimed to believe that the world economy was “on the precipice of catastrophe,” and his customers should invest in these non-traditional ETFs as a safeguard. As a result of this belief, Martin recommended to almost all of his customers that they invest almost exclusively in and hold for long periods of time non-traditional ETFs, despite the enormous risks associated with holding these investments for more than one trading session; one day.

FINRA Bars Former Sagepoint Financial Broker for Stock Manipulation of an Illiquid OTC Security

November 29, 2016 | Silver Law Group

Silver Law Group is investigating former Sagepoint Financial, Inc. (CRD# 133763) broker Gary E. Donovan (CRD# 866235) after FINRA permanently barred Donovan for placing limit buy orders for an illiquid OTC security MIXX.

In May 2016, FINRA permanently barred Donovan after he placed 180 buy orders for Mix 1 Life, Inc. (“MIXX”), an illiquid security traded on the OTC Markets, in 90 customer accounts according to the Acceptance, Waiver & Consent (“AWC”) entered into with FINRA. Donovan also placed buy orders in two other accounts owned by himself and his immediate family members, according to the AWC.

According to the AWC, Donovan made the purchases at a stock promoter’s direction. Donovan, according to the AWC, placed 100 limit orders that were matched in amount and price with recently-placed sell limit orders. Donovan’s limit orders were frequently priced above the market and/or inside ask price for MIXX, according to the AWC, and the orders had the effect of stabilizing the price of MIXX at around $6.00 per share.

FINRA-barred Janney Montgomery Scott Broker Under Investigation for FINRA Arbitrations

November 29, 2016 | Silver Law Group

Silver Law Group is investigating recently-FINRA-barred former Janney Montgomery Scott LLC (CRD# 463) broker David A. Seigerman (CRD# 2200011).

FINRA permanently barred Seigerman after he failed to respond to a FINRA request for information. The FINRA bar follows a suspension the regulatory body levied on Seigerman in April 2016 for failing to comply with an arbitration award or settlement agreement or to satisfactorily respond to a FINRA request to provide information concerning the status of compliance.

Seigerman, based out of New Jersey, has a total of seven disclosures on his FINRA BrokerCheck report, including the two regulatory proceedings noted above. He currently has one FINRA arbitration pending that alleges failure to follow instruction and breach of fiduciary duty, among other things. The FINRA arbitration alleges damages in the amount of over $350,000. Additionally, another FINRA arbitration settled in September 2010 for $43,000 that alleged unauthorized trading.

Silver Law Group Files Claim Against Citigroup Broker Charlie Yeung for Unsuitable Recommendation in Alpha Natural Resources

November 29, 2016 | Silver Law Group

Silver Law Group has filed a claim against Citigroup Global Markets Inc. (CRD# 7059) broker Charlie Yeung (CRD# 2785343) for unsuitably recommending and overconcentrating our client in Alpha Natural Resources.

Our client doesn’t speak English and felt comfortable with Yeung because he could speak her native language. Yeung proceeded to invest heavily in Alpha Natural Resources, an oil and gas company that has declined precipitously over the last three years and declared bankruptcy in 2015.

Our client is older, retired, and had a conservative risk profile, yet Yeung proceeded to overconcentrate our client’s money in the risky oil, gas and energy sector. Consequentially, our client lost a majority of the investment and the value of her account.

FINRA Considers Establishing Fund for Unpaid FINRA Arbitration Awards

November 28, 2016 | Silver Law Group

According to published reports that have been confirmed by a member of the Board of Governors of the Financial Industry Regulatory Authority (FINRA), FINRA is undertaking closed-doors discussions focused on establishing a relief fund that would be used to pay otherwise unpaid FINRA arbitration awards. Such a fund would endeavor to partially solve the problem of investors who obtain arbitration awards against FINRA member firms and brokers, only to find it impossible to collect on those victories. Statistics show that in the most recent year for which data is available, a total of $62 million in awards — approximately one-third of all awards rendered by FINRA arbitration panels — went unpaid. Typically, arbitration awards go unpaid after brokerages and financial advisors declare bankruptcy or are otherwise insolvent, thus rendering hollow the awards entered against them in favor of aggrieved claimants.

Under one plan that has been proposed, FINRA members would pay dues annually into a designated pool (approximately $100 per broker) to help compensate claimants who hold victorious, but uncollectible, arbitration awards. Such a pool would be created and maintained based on the average sum of unpaid claims over the previous five years. All of the money in the fund would be paid out annually.

If FINRA were to establish such a recovery fund, many claimants for whom compensation is currently unattainable would find a viable source of reparation from bankrupt firms and brokers. In addition, the existence of such a fund is expected to bolster investors’ confidence in the arbitration process, as it would prevent the substandard acts of certain FINRA members from going unchecked and would prevent the arbitration process from being a financially fruitless effort for those investors harmed by judgment-proof firms and brokers.

Failure to Comply with FINRA Request Terminates Broker Lance Shaw’s Securities Industry Career

November 21, 2016 | Silver Law Group

Failure to Comply with FINRA Request Terminates Broker Lance Shaw’s Securities Industry Career on silverlaw.com

Allegations against the former Orlando broker include unauthorized trading and misrepresentation, among others.

Lance Shaw performed as a broker in the securities industry over the span of 15 years, however, in May 2016, the Financial Industry Regulatory Authority (FINRA) permanently barred him from acting as a broker or otherwise associating with firms that sell securities to the public.

Over the course of a FINRA investigation into Shaw’s performance in the financial industry, the broker – most recently employed by International Assets Advisory LLC in Orlando, FL – failed to respond to the agency’s request for information. In eight customer disputes, allegations against Shaw included unauthorized trading, improper and excessive trading (otherwise known as churning, an activity that inflates broker commissions), mismanagement, unsuitability, and misrepresentation. Damages requested in these disputes exceed over $600,000.

Are (or Were) Unsuitable Non-Traded REITs in Your Portfolio?

November 7, 2016 | Silver Law Group

Are (or Were) Unsuitable Non-Traded REITs in Your Portfolio? on silverlaw.com

Learn the details about this vehicle, and why it may be an unsuitable investment

REITs, or real estate investment trusts, are companies that own real estate-related assets. These may include office parks, hotels, homes, or even related debt like mortgages. REITs are an attractive investment because they can often provide a steady stream of income to investors, as the IRS mandates that they distribute at least 90% of their taxable income to shareholders.

Most REITs are publicly registered and publicly traded on major stock exchanges – however, some are not publically traded. These non-exchange traded REITs are usually managed by a private investment manager, and they can be much riskier than their tradable cousins.

FINRA Permanently Bars Gary Eugene Donovan for Stock Manipulation

November 7, 2016 | Silver Law Group

FINRA Permanently Bars Gary Eugene Donovan for Stock Manipulation on silverlaw.com

Donovan was also discharged from SagePoint Financial in Newark, OH

The Financial Industry Regulatory Authority (FINRA) has permanently barred broker Gary Eugene Donovan from acting as a broker or otherwise associating with firms that sell securities to the public. Up until early 2016, Donovan worked as a broker for a number of brokerage firms around the U.S., most recently SagePoint Financial, Inc. in Newark, OH from October 2005 to January 2016.

Donovan was discharged from SagePoint when it was determined by the firm that he had failed to follow their policies covering the interaction of brokers and stock promoters, as well as the sale of unlisted securities relating to Mix 1 Life, Inc. (OTC: MIXX).

FINRA Suspended Broker Edward R. Segur

November 7, 2016 | Silver Law Group

FINRA Suspended Broker Edward R. Segur on silverlaw.com

Allegations against the New York broker include placing orders without a customer’s consent

According to the Financial Industry Regulatory Authority (FINRA), New York broker Edward R. Segur III is alleged to have opened and traded funds in an outside account opened in his wife’s name, in violation of his firm’s written supervisory procedures (WSPs), and to have accepted orders from a customer’s husband without the customer’s consent. Segur was suspended for 30 days, which ended on July 19th, 2016.

Segur currently works at Fordham Financial Management, Inc., where he has been registered since April 2015. Previously, he was employed at Four Points Capital Partners (Nov. to May 2015), Blackwell Capital Markets, Inc. (Oct. 2012 to Nov. 2013), and Rockwell Global Capital, LLC (Apr. 2012 to Oct. 2012), all in New York, among many other prior firms.

Wells Fargo Broker Wonnie Lynn Short Permanently Barred by FINRA

November 7, 2016 | Silver Law Group

Wells Fargo Broker Wonnie Lynn Short Permanently Barred by FINRA on silverlaw.com

Allegations against the Nashville broker include failure, as executor of client’s estate, to provide a charitable foundation with its due proceeds

The Financial Industry Regulatory Authority (FINRA) has barred Wonnie Short permanently from acting as a broker or otherwise associating with firms that sell securities to the public. While registered with Wells Fargo in Nashville, TN, Short is reported to have been named executor of a client’s estate. In fact, according to FINRA, Short was to receive two-fifths of the client’s residuary estate.

However, according the same FINRA report, Short’s client designated that 90% of her annuity – valued at the time of her death at $102,000 – would go to a local charitable foundation, and the remaining 10% would go to her estate. As the executor of the estate, Short allegedly received full payment from the annuity, yet did not ensure that the charitable foundation received its portion, valued at approximately $92,000.