$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

SEC Halts Fraud by New Jersey-Based Fund Manager of Investments in Pre-IPO Tech Companies

March 28, 2016 | Silver Law Group

The Securities and Exchange Commission announced fraud charges and asset freezes obtained in a case filed on March 21, 2016 against a New Jersey-based fund manager and two firms he controls for orchestrating a Ponzi-like scheme that marketed shares in promising pre-IPO technology companies in the Bay Area.

The SEC alleges in its complaint that John Bivona raised over $53 million through Saddle River Advisors and SRA Management Associates (collectively, the “SRA Funds”) and used the assets to pay off earlier investors, establish and fortify other funds, and pay family-related expenses. The complaint also alleges that Bivona stole over $5.7 million from investors and diverted millions more to other improper and undisclosed uses.

According to the complaint, much of the funds were diverted to Bivona’s nephew, Frank Mazzola, who was barred from the securities industry in a prior SEC enforcement action and is also charged in the complaint. The diverted funds were used to pay, among other things, credit card bills, income taxes, a car loan, unrelated defense attorney fees, and the mortgage on a Jersey Shore vacation home, according to the complaint.

Investor Beware: Does Your Broker Have Access to Your Online Trading Account?

March 22, 2016 | Silver Law Group

Investor Beware: Does Your Broker Have Access to Your Online Trading Account? on silverlaw.com

California broker, Angelo Talebi, finds himself in hot water with his firm and FINRA, as well as his clients.

Does your broker have your username and password for your online trading account? If so, does his current employer know that he does? If not, it could spell trouble for everyone involved.

Take into account Royal Alliance Associated, Inc. broker Angel Talebi out of California according to FINRA records, or about December 2013, Talebi’s customer from Royal Alliance Associates, Inc. moved his accounts with Royal to another FINRA member firm that provided online trading. Without informing Royal, Talebi used the customer’s login credentials to execute transactions through the customer’s other FINRA member firm.

LPL Financial Broker Eugene Smietana Discharged from Firm and Permanently Barred by FINRA

March 21, 2016 | Silver Law Group

LPL Financial Broker Eugene Smietana Discharged from Firm and Permanently Barred by FINRA on silverlaw.com

Have you invested funds with Eugene Smietana?

For investors who may have utilized the services of LPL Financial LLC broker Eugene Smietana out of Traverse City, Michigan, may have potential claims against LLP.

As of September 2015, FINRA has permanently barred Smietana from acting as a broker or otherwise associating with firms that sell securities to the public.

Broker Russell Macke Banned by FINRA After Multiple Complaints, FINRA Actions, and Terminations

March 18, 2016 | Silver Law Group

Broker Russell Macke Banned by FINRA After Multiple Complaints, FINRA Actions, and Terminations on silverlaw.com

Churning, unsuitable investments misconduct and elder fraud among allegations that ended Macke’s career

In October 2015, the Financial Industry Regulatory Authority (FINRA) permanently banned Russell Macke from acting as a broker and from associating with any securities firms. This decision comes after numerous customer complaints, regulatory actions, employment terminations, as well as seven judgments or liens against him. Macke has been accused of churning, investment fraud, unsuitable investments as well as several other charges.

Macke has been registered in the securities industry since 1989. He was most recently registered with B.B. Graham & Company of Orange, CA (between 2012-2015). Other recent registrations include:

Morgan Stanley Discharges and FINRA Permanently Bars Broker Samuel Wylie Sloane

March 17, 2016 | Silver Law Group

Morgan Stanley Discharges and FINRA Permanently Bars Broker Samuel Wylie Sloane on silverlaw.com

Broker accused of taking $1.8M in trust assets while serving as a trustee.

Samuel Wylie Sloane’s 15-year career in the securities industry ended abruptly in December 2015 when FINRA permanently barred him from acting as a broker or otherwise associating with firms that sell securities to the public.

According to the disciplinary action document in Sloane’s FINRA BrokerCheck record, the broker refused to respond to FINRA’s request for documents and information during an investigation. The investigation was initiated following allegations that Sloane converted a customer’s trust assets while serving as a trustee.

David Levy, of Titus Rockefeller, LLC, Permanently Barred from Broker Activity After Long Career of Suspicious Activity

March 17, 2016 | Silver Law Group

David Levy, of Titus Rockefeller, LLC, Permanently Barred from Broker Activity After Long Career of Suspicious Activity on silverlaw.com

Financial broker finally barred from FINRA activity after decades of questionable behavior.

After a career plagued by multiple and repeated allegations of breaches of fiduciary duty and unauthorized trading dating back to 1994, David Levy has been permanently barred by FINRA for acting as a broker in any capacity. These final sanctions come as a result of failure to provide FINRA required information; specifically, he did not request termination of his most recent suspension within three months of the date of the suspension. He was permanently barred from all broker activities, effective September 29, 2015.

FINRA’s final action against Levy comes after more than 20 years of serious allegations against him, including churning, misrepresentation, and breach of fiduciary duty. Multiple client disputes total nearly $2 million, however, many of the companies he was affiliated with at the time of the specific allegations settled with clients for much less.

Have You Invested Money with William “Billy” Nelson and Lost?

March 16, 2016 | Silver Law Group

Have You Invested Money with William “Billy” Nelson and Lost? on silverlaw.com

Customer disputes, judgments and tax liens checker this New York broker’s record.

William “Billy” Nelson entered the securities industry over 18 years ago and to date has 16 disclosure events reported on his FINRA BrokerCheck record. Allegations against Nelson, currently with Meyers Associates, L.P., include a wide range of transgressions such as:

Unauthorized transactions

Recidivist Fraudster Edward Durante is Indicted for Scamming Investors out of $11 Million Through the Sale of VGTel

March 16, 2016 | Silver Law Group

After serving 10 years in prison for prior securities law violations, investment fraud orchestrator Edward Durante is back in the news for allegations of a penny stock pump-and-dump scheme.

Durante was criminally charged in December 2015 by the U.S. Attorney’s Office for the Southern District of New York and civilly charged by the Securities Exchange Commission (the “SEC”) for defrauding at least 50 investors out of at least $11 million through the sale of securities of VGTel, Inc. (“VGTel”), a shell company Durante controlled.

According to the SEC’s complaint, Durante sold approximately six millions shares of VGTel stock to investors using various fictitious names to hide his criminal past, including “Edward Wise,” “Ted Wise,” “Efran Eisenberg,” and “Anthony Walsh.” He solicited and enlisted the aid of Larry Werbel (CRD# 828351) and his adviser firm Evolution Partners Wealth Management, LLC (“Evolution Partners”), Sheik Khan (CRD# 2448117), Christopher Cervino (CRD# 2778817), Walter Reissman, and Kenneth Wise to help perpetrate the scheme, according to the complaint.

New York Broker Patrick Teutonico Under Investigation

March 16, 2016 | Silver Law Group

According to the Financial Industry Regulatory Authority (FINRA) BrokerCheck website, a customer filed a complaint against Teutonico (CRD# 2875434) on November 23, 2015 for excessive trading. This is the eleventh disclosure on his checkered broker report and the fifth in the last year. Teutonico has been employed by Network 1 Financial Securities, Inc. since December 2012.

Silver law group previously covered Teutonico’s checkered broker report and the ramifications of a report littered with disclosures. On March 27, 2015, Teutonico, without admitting or denying the findings, consented to sanctions in the amount of $5,000 and a suspension totaling 15 business days for failing to observe the high standards of commercial honor and just and equitable principles of trade in violation of FINRA Rule 2010.

Teutonico’s other FINRA report disclosures indicate multiple clients alleging he churned their accounts – meaning he allegedly made excessive trades in client accounts to generate commissions. Additionally, the disclosures allege that he made unsuitable and unauthorized transactions, abused commissions, breached his fiduciary duty, executed excessive markup/markdowns and committed possible fraud, all totaling more than $650,000 in requested damages.

SEC Charges Oregon-based Aequitas Management LLC and Its Executives with Operating $350 Million Investment Fraud

March 16, 2016 | Silver Law Group

The U.S. Securities and Exchange Commission (SEC) has charged Oregon-based Aequitas Management, LLC (“Aequitas”), and several of its executives with operating a $350 million investment scheme that defrauded investors in a last-ditch effort to raise funds to save Aequitas from a complete financial collapse. Aequitas, along with CEO Robert J. Jesenik, Executive Vice President Brian A. Oliver, and former CFO and COO N. Scott Gillis, were charged with multiple violations of federal securities laws in a Complaint filed in Oregon federal court. The SEC is seeking injunctive relief, disgorgement of ill-gotten gains, prejudgment interest, and civil monetary penalties as well as bars prohibiting Jesenik, Oliver, and Gillis from serving as officers or directors of any public company.

According to the SEC’s Complaint, Aequitas and four of its corporate affiliates (Aequitas Holdings LLC, Aequitas Commercial Finance LLC, Aequitas Capital Management Inc., and Aequitas Investment Management LLC) defrauded more than 1,500 investors nationwide between January 2014 and January 2016 into believing they were making health care, education, and transportation-related investments. To the contrary, the Complaint alleges that invested funds were instead being used for other purposes, including to pay lucrative salaries and extravagant perks for Jesenik, Oliver, and Gillis; and to stave off the businesses’ impending financial collapse. In mid-2014, Corinthian Colleges, a for-profit education provider, defaulted on its recourse obligations to Aequitas, which significantly increased Aequitas’ already dire cash flow problems. Rather than disclose to its investors the rapidly deteriorating state of its finances, Aequitas purportedly hid that vital information and used investor funds to keep its enterprise afloat — even using some new investor funds to pay earlier investors in a classic Ponzi scheme fashion. By November 2015, Aequitas’ operations reached a point of nearly total collapse; and in February 2016, the firm dismissed two-thirds of its employees and hired a Chief Restructuring Officer.

“We alleged that Aequitas had severe and persistent cash flow shortages and top executives knew they weren’t using money raised from investors like they said they would. But they refused to disclose the true financial condition, continued to draw lucrative salaries, and roped even more unknowing investors into a losing venture,” said Jina L. Choi, Director of the SEC’s San Francisco Regional Office.