Securities Arbitration Lawyers Blog

Massachusetts-based Broker Jeffrey B. Pierce Permanently Barred by FINRA

October 23, 2015 | Silver Law Group

Massachusetts-based Broker Jeffrey B. Pierce Permanently Barred by FINRA on silverlaw.com

Allegations include conversion of funds from non-securities customer account

After thirteen years in the securities industry, Jeffrey Pierce has been permanently barred from practicing in the securities industry in any capacity. During his career, Pierce accumulated eleven disclosure events, including regulatory events, a criminal event, customer disputes and two employer terminations.

The most recent complaint, according to FINRA’s BrokerCheck report, alleges that Pierce circumvented the procedures of his member firm in order to conceal unsuitable annuity replacement transactions.

New Rule to Protect Investors Has Brokers Upset

October 23, 2015 | Silver Law Group

New Rule to Protect Investors Has Brokers Upset on silverlaw.com

Wronged investors feel otherwise about ending abuse by brokers

There’s a new rule being proposed by the Labor Department that will help protect average investors from brokers who don’t always act in their customer’s best interest. This rule, five years in the making, has the brokerage industry concerned that Wall Street will be governed by a fiduciary standard.

While many brokers do put their customers’ best interests first, the new rule could make a difference in protecting the average investor from those who don’t. According to a recent article in the New York Times, “under current standards, brokers only have to recommend suitable investments, a requirement that permits them, for example, to recommend a more expensive fund that pays a higher commission even when an identically performing, cheaper fund would have been the better choice.”

Five Arizona Residents Charged By SEC for Stealing From Investors

October 22, 2015 | Silver Law Group

According to one accused, they “robbed Peter to pay Paul” while living the high life

Living the high life has come to an end for five Arizona who were charged with stealing millions from investors by the SEC. According to the SEC release on September 11, the participants allegedly used stolen funds to make car payments, buy clothes and fund travel and entertainment at luxury resorts, casinos and strip clubs.

It is alleged that the five individuals—Jason Mogler, James Hinkeldey, Casimer Polanchek, Brian Buckley and James Stevens—raised close to $18 million from 225 investors who believed the group was acquiring and developing beachfront property in Mexico, as well as operating recycling facilities and purchasing foreclosed residential properties for resale. They told investors they were buying promissory notes from licensed brokers, however, none of the accused were registered with the SEC to solicit investments, according to Michele Wein Layne, Director of the SEC’s Los Angeles Regional Office.

Proposed Fiduciary Duty Rule Poised to Pass, Leaves Brokers Seething

October 20, 2015 | Silver Law Group

New Department of Labor rule looks to protect investors from over-zealous brokers

In an effort to protect investors from conflicted investment advice, the Department of Labor is seeking to instate a new fiduciary duty rule that has left many independent brokers-dealers chafing in their suits.

What is a fiduciary duty?

Rainmaker Securities Sanctioned by Regulators for Multiple Violations

October 19, 2015 | Silver Law Group

Rainmaker Securities Sanctioned by Regulators for Multiple Violations on silverlaw.com

President Glen Anderson sanctioned along with Rainmaker Brokerage Firm

With six branches and 34 registered persons, Rainmaker Securities, LLC is in hot water with both FINRA and the SEC. Its president, Glen Anderson, is also included in the sanctions brought against the firm, according to official FINRA documents. The allegations include failure to devote appropriate time, attention and resources to supervision of its financial advisors, among other allegations.

Rainmaker Securities was registered with FINRA in 2005, and Anderson joined the brokerage firm as President in 2010. Rainmaker is approved to conduct business in the origination and sale of private placements. It is alleged that between June 2011 and September 2014, the firm—under Anderson’s direction—consistently violated FINRA rules that required the firm to:

UBS to Pay FINRA Claimants $3M in Puerto Rico Muni Bond Case

October 18, 2015 | Silver Law Group

FINRA arbitration panel finds bank liable in alleged fraud claim

As Puerto Rico’s financial struggles continue, a FINRA arbitration panel awarded three claimants $3M in an alleged fraud claim against UBS Financial Services in early September.

According to Law360.com, the claimants alleged that the bank committed fraud relating to closed-end funds and muni bonds, and how the bank used those investments as collateral to borrow funds through lines of credit. Included in the complaint were allegations of breach of fiduciary duty, negligence and breach of contract against UBS.

Broker Bradley Drude Suspended and Fined due to Undisclosed Conflict of Interest

October 17, 2015 | Silver Law Group

Drude’s failure to disclose details surrounding fraud of elder investor drives FINRA action

In response to allegations surrounding his relationship with an elderly investor, Louisiana-based broker Bradley Drude agreed to an Offer of Settlement to FINRA in which he was assessed a deferred fine of $25,000 and suspended from association with any FINRA member in any capacity for six months, according to the FINRA Disciplinary Action report.

It is alleged that Drude failed to disclose that an elderly client had named him as executor and beneficiary in her will and granted him general power of attorney. It is also alleged that he typed a new will for the client naming himself as such and drove the client to a notary’s office to have her sign it—all without the involvement or assistance of the client’s attorney. The estate was valued at approximately $3 million. When the client requested a change to the will, it is alleged that Drude prepared a codicil to the will, but did not drive the client to the notary to have it notarized, knowing it would be invalid without notarization.

Philip Grasso Jr. Barred by FINRA Due to Allegations of Elder Fraud

October 16, 2015 | Silver Law Group

Broker misconduct results in “substantial harm’ to elderly customers

Philip Leonard Grasso Jr.’s 18-year career in the securities industry is now over due to allegations of elder fraud, where he purportedly misused funds, willfully misrepresented material facts and failed to complete on-the-record testimony requested by FINRA.

According to the FINRA Disciplinary Action, Philip Grasso has been permanently barred from association with any FINRA member in any capacity as of May 2015. There are three causes of action included in the findings.

Broker Justin Amaral Permanently Barred from Securities Industry

October 15, 2015 | Silver Law Group

Failure to provide on-the-record testimony to FINRA results in disciplinary action

After termination from employment with Morgan Stanley in 2014 following allegations surrounding his status as an executor and beneficiary in a client’s estate and his use of discretion in several client accounts, broker Justin Amaral has been permanently barred from the securities industry by FINRA.

According to Amaral’s BrokerCheck record, as of June 2015 the Boston-based broker’s 12 years in the securities industry has ended as a result of his failure to appear for an on-the-record testimony requested by FINRA during the course of an investigation. The requested testimony may be related to the reasons Morgan Stanley terminated Amaral’s employment.

Miami Broker Mikell Simmons Fined and Suspended by FINRA

October 14, 2015 | Silver Law Group

Failure to disclose criminal charges results in $5,000 fine and suspension

During a 15-year career in the securities industry, Miami-based broker Mikell Simmons has seen a total of six disclosure events on his official record, the most recent of which includes a one-month suspension and a $5,000 fine.

According to Simmons’ FINRA BrokerCheck record, the Miami broker, most recently registered with Global Strategic Investments, failed to update his U4 form required by the regulatory body with information pertaining to criminal charges brought against him in February 2013 while he was employed by CP Capital Securities. Per FINRA broker requirements “an individual is under a continuing obligation to amend and update information required by Form U4 as changes occur.” As a result, on June 11, 2015, FINRA handed Simmons a one-month suspension along with a $5,000 fine.