Securities Arbitration Lawyers Blog

Christopher Veale Under Investigation From FINRA After Churning Allegations

July 31, 2015 | Silver Law Group

Disciplinary action Pending

In April, FINRA initiated a regulatory investigation after Christopher Frederic Veale, most recently employed by Legend Securities, Inc., allegedly refused to provide documents requested by the agency in response to alleged rule violations. The purported violations involve business and outside business activities, as well as a potential violation of FINRA disclosure requirements in regard to outstanding liens, of which he has a great sum, according to FINRA.

Veale’s 18-year career in the securities industry has been fraught with dispute, both with FINRA and with customers. He has been employed by 18 firms, seven of which have since been expelled by FINRA, according to its website. Amongst other firms, Veale has been employed at John Thomas Financial, Meyers Associates, LP, and Blackwall Capital Markets, Inc.

Silver Law Group Investigates FINRA-Barred Broker Thomas Buck

July 30, 2015 | Silver Law Group

Silver Law Group is investigating Indiana-based stockbroker Thomas Buck, who earlier this week was barred by the Financial Industry Regulatory Authority (FINRA) from associating with any FINRA member firm and was accused by FINRA of improperly charging customers and engaging in unauthorized trading. Mr. Buck, a former top broker for Bank of America Merrill Lynch from 1981 until early-2015, was most recently employed by RBC Wealth Management.

According to FINRA, Buck oversaw $1.3 billion in assets while at Merrill Lynch, which made him Merrill’s top broker in Indiana. Buck is alleged to have almost exclusively steered his clients into using commission-based accounts since at least 2009 despite the fact that it would have been less expensive for the clients to remain in fee-based accounts. In addition, Buck is believed to have placed trades on behalf of clients without obtaining proper authorizations, something that is prohibited under FINRA standards.

“He at times unilaterally placed trades in customer accounts without getting the customers’ acquiescence in advance, or even after placing the trade,” FINRA wrote. “In other instances, customers explicitly or implicitly allowed him to place trades in their account without prior discussion. Buck did not obtain written authorization to do so from either the customers or Merrill Lynch.”

Jon Cox Barred From Securities Industry After FINRA Launches Investigation

July 28, 2015 | Silver Law Group

Investigation follows termination from LPL Financial

Jon Lawrence Cox, who has been in the securities industry since June 1990, according to FINRA documents, has been barred as of April 29 after allegedly failing to respond to three written requests from FINRA to provide information to aid an investigation into allegations against him.

Cox was discharged from LPL Financial after allegedly violating policies about outside business activities, according to a disclosure made by the firm. After receiving this information, FINRA launched its own investigation into whether those activities violated its rules as well. FINRA requested information from Cox, who allegedly did not provide it, leading to his barring.

Two LPL Financial LLC Brokers, Thomas Caniford and Andrew Carter, Permanently Barred by FINRA

July 27, 2015 | Silver Law Group

Both brokers barred following termination from same firm

One broker had over 30 years’ experience in the securities industry. One broker had only one year of experience in the securities industry. Yet both brokers were terminated from LPL Financial LLC within a month of each other.

According to the FINRA BrokerCheck website, both Thomas H. Caniford and Andrew M. Carter were terminated earlier this year from the firm for what seem to be fairly similar reasons.

Should You Trust Penny Stocks Endorsed by Celebrities?

July 24, 2015 | Silver Law Group

A big name may not always equal big opportunity.

It’s all around us. Branded tennis shoes, hats and apparel worn by top-ranked, world-famous tennis players. NASCAR drivers and their cars blanketed in corporate logos. Famous models and actresses designing and promoting furniture lines. Top-selling country singers performing with beverage company logos adorning their stages, their tour buses and their fan t-shirts. Everywhere we turn, companies are promoting themselves with the help of famous people.

Why should penny stocks be any different?

Investors Beware: SEC Warns of Financial Professionals Making False Claims

July 23, 2015 | Silver Law Group

Tips on how how to be alert so you do not fall victim to an investment scheme.

The old adage “don’t believe everything you hear or read” rings true in the case of a recent Securities Exchange Commission (SEC) Investor Alert. This particular alert warns investors about financial professionals that may misrepresent their backgrounds and professional experience to lure investors into investment schemes.

Fraudulent Information Abounds

Broker Focus: Patrick Teutonico in the Spotlight for Unauthorized Transactions

July 22, 2015 | Silver Law Group

According to FINRA Teutonico failed to observe high standards of commercial honor.

According to the Financial Industry Regulatory Authority (FINRA) Broker Check website, broker Patrick Teutonico is once again in the spotlight. Over the course of 17 years in the securities industry, Teutonico has 10 disclosures to report.

To provide some background, brokers are required by FINRA – known as the industry watchdog – to disclose different types of events, from customer complaints to IRS tax liens, judgments and even criminal matters. As such, Teutonico has 10 on his record, many of which involve allegations of unsuitable and unauthorized transactions. According to InvestmentNews, only about 12% of financial advisors have any type of disclosure event on their records. Therefore, it would seem the number of disclosures by Teutonico is relatively high.

Investor Update: What You Need to Know About Churning

July 21, 2015 | Silver Law Group

Churning is a Type of Securities Fraud

What is churning?

Simply put, churning is defined as excessive trading.

Have You Suffered Financial Losses with Bruce Sabourin?

July 20, 2015 | Silver Law Group

Formerly of Cetera Advisors, you may not be the only one who has suffered.

Investment broker Bruce Michael Sabourin (CRD #2556826), most recently with Cetera Advisors, once again has a FINRA reported disclosure. Sabourin is now permanently barred from acting as a broker or otherwise associating with firms that sell securities to the public. According to the April 2015 FINRA Disciplinary and Other FINRA Actions Report, Sabourin was suspended as of February 23, 2015 for allegedly failing to provide information or keep information current according to FINRA rules.

What exactly is FINRA, you ask? Good question. It is the Financial Industry Regulatory Authority. All brokers and investment firms must agree to abide by FINRA rules. It’s the watchdog you want keeping an eye on investment players to make sure everyone is playing by the same rules. When someone isn’t, FINRA steps in.

SEC Charges Florida based DFRF Enterprises, LLC with Operating $15 Million Gold Mining Ponzi Scheme Targeting Spanish and Portuguese-speaking Investors

July 17, 2015 | Silver Law Group

The U.S. Securities and Exchange Commission (SEC) has charged Orlando, Florida-based DFRF Enterprises, LLC, its owner, and several of its promoters with operating a $15 million pyramid and Ponzi scheme falsely promising over 1,400 investors in Spanish and Portuguese-speaking communities in Massachusetts, Florida, and elsewhere interests in non-existent gold mines in Brazil and Africa. DFRF Enterprises, LLC (a Florida-based company), DFRF Enterprises LLC (a Massachusetts-based company) (collectively “DFRF”), company owner Daniel Fernandes Rojo Filho (of Winter Garden, FL), and investment promoters Wanderley M. Dalman (Revere, MA), Gaspar C. Jesus (Malden, MA), Eduardo N. DaSilva (Orlando, FL), Heriberto C. Perez-Valdes (Miami, FL), Jeffrey A. Feldman (Boca Raton, FL), and Romildo DaCunha (Brazil) were charged with multiple violations of federal securities laws in a Complaint filed in Massachusetts federal court. The SEC is seeking injunctive relief, disgorgement of ill-gotten gains, prejudgment interest, and civil monetary penalties.

According to the SEC, DFRF claimed to operate more than 50 gold mines in Brazil and Africa that collectively produced 13-16 tons of gold monthly, realized a return of over 100% on each kilogram it produced, and controlled gold reserves valued at approximately $1.4 trillion. The sales pitch also claimed, among other things, that DFRF donated 25% of its profits to African charities and that investors could realize a 15% monthly return — an annual return of nearly 200%. DFRF purportedly promised investors that their investments were fully insured and promised investors that with the company’s stock allegedly set to become publicly traded, each investor would have the ability to convert his/her membership interests into stock options at approximately $15.00 per share. When recently questioned about the status of the stock, Filho allegedly claimed that the “value” of the stock had already surpassed $64 per share.

However, according to the SEC: “There are no gold mines, no gold reserves, or no gold operations. DFRF bank documents indicate that none of the investors’ money has been used to conduct gold mining, and DFRF has received no proceeds from gold mining operations.” Instead, the SEC has charged that the company’s revenue came solely from selling membership interests to investors, not from mining gold; and that to keep the fraud afloat, commissions were paid to earlier investors using new investors’ funds in typical a Ponzi-like fashion. In the SEC lawsuit, Filho is accused of siphoning more than $6 million for his own personal lavish lifestyle that included a fleet of luxury automobiles.