Securities Fraud Investigation Involving 3 Former Securities America Financial Advisors.

Monday, April 15th, 2013

The White Law Group is currently investigating 3 Ohio brokers who either work or have worked with Securities America.  These advisors, Michael C. Permuter, Howard A. Slater and Azim Nakhooda, who may have misrepresented high-risk investments to their clients. When brokers mislead or misrepresent an investment to a client, the brokerage-firm may be held liable for losses in a FINRA arbitration claim.

According to the Plain Dealer, Michael C. Permuter, Howard A. Slater and Azim Nakhooda, “made “false and misleading statements” about the IMH Fund, a security backed by subprime mortgages, and Medical Capital Holdings Inc., an Anaheim, Calif.-based Company that turned out to be a Ponzi scheme that had marketed $2.2 billion in notes to more than 20,000 investors nationwide.” All three men have been suspended by the Financial Industry Regulator Authority (FINRA) and entered in to a Letter of Acceptance, Waiver and Consent (AWC).

The misleading statements to clients allegedly occurred between 2007-2008. It appears that Nakhooda was the first to make misleading statements to clients according to the AWC, “From October 2007 to September 2008, Nakhooda sent emails to seven SAI customers in connection with their purchases of units in the IMH Secured Loan Fund, LLC (“IMH Fund”) and/or notes issued by Medical Provider Funding Corporation V (“Med Cap V”) that contained misrepresentations regarding the features of the IMH Fund and Med Cap V.”

According to FINRA BrokerCheck, the three men have a long history of working together. Prior to moving to Ohio to work with Securities America in 2005, all three men worked together at Lincoln Financial Advisors.  In 2005, Howard Slater apparently formed Cedar Brook Financial Partners, LLC in Pepper Pike, OH and this appears to have been the name of the advisory firm under which the three operated (Even though the three operated under the name Cedar Brook Financial Partners, their FINRA employers would have still been responsible for supervising them and ensuring that each were following FINRA Rules).

According to FINRA BrokerCheck, Michael C. Perlmuter was a registered broker for Securities America, Inc from 09/2005-05/2011, and with Lincoln Financial Advisors Corp. from 06/1999-09/2005. Howard A. Slater was a registered broker working with Securities America 07/2005-02/2013, and with Lincoln Financial Advisors from 01/1994-07/2005. Azim Nakhooda was a registered broker working with Securities America from 08/2005-03/2013 and Lincoln Financial Advisors 08/1997-08/2005.

Brokers have a legal obligation to disclose all the risk of any investment prior to making recommendations. In addition, financial advisors must perform adequate due diligence to ensure recommendations are suitable for an investor given age, liquidity needs, financial objectives and risk tolerance. To the extent that Michael C. Permuter, Howard A. Slater and Azim Nakhooda misrepresented the IHM investment to their clients, their FINRA employers may be legally responsible for investment losses through a FINRA arbitration claim.

IMH is an investment that The White Law Group has been following for quite some time.  For more information on The White Law Group’s IMH Secured Loan Fund investigation, click here.

If you have suffered significant losses in your portfolio as a result of your investment with Michael C. Permuter, Howard A. Slater and Azim Nakhooda, and would like to discuss your litigation options with a securities attorney, please call The White Law Group at 312-238-9650 for a free consultation.

The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Boca Raton, Florida and Chicago, Illinois.  The firm represents investors throughout the country in FINRA arbitration claims against brokerage firm and financial advisors.

For more information on The White Law Group, visit http://www.whitesecuritieslaw.com.

Tags: , , , , , , , , , , , , , , , , , , , ,