Posts tagged ‘broker fraud’
MML Investors Services, LLC fined by FINRA over supervisory and compliance issues
MML Investors Services, LLC recently submitted a Letter of Acceptance, Waiver and Consent in which the firm was censured, fined $300,000 and required to review its supervisory systems and WSPs for compliance with its reporting obligations concerning the timely filing of Uniform Application for Securities Industry Registration or Transfer (Form U4) disclosure amendments and the timely filing of Uniform Termination Notices for Securities Industry Registration (Forms U5) and Form U5 amendments.
Without admitting or denying the findings, the firm consented to the described sanctions and to the entry of findings that it failed to timely file Forms U5 and amendments to Forms U4 and U5. The findings further stated that the firm’s failure to comply with its reporting obligations may have hampered the investing public’s ability to assess the background of certain brokers through FINRA’s public disclosure program, rendered certain information unavailable to member firms making hiring determinations, may have reduced the ability of state securities regulators to review applications by brokers to transfer firms, and hindered FINRA from promptly investigating certain disclosure items.
FINRA’s public disclosure program is an essential tool for investors and members of the securities industry to perform research on financial professionals. If the information provided is outdated or inaccurate this can lead to serious problems.
According to FINRA’s findings, there were numerous instances of late filings in which MML Investors Services either failed to issue a letter of warning to the representative or failed to fine the representative as called for by its procedures. The findings also included that although the firm’s procedures called for the termination of any representative who failed to timely disclose three reportable events to the firm, it did not terminate at least two such representatives. There were also instances in which the firm failed to sanction supervisors as called for by its procedures.
This information which is publicly available on FINRA’s website has been provided by The White Law Group, LLC.
If you have questions about investments you made with MML Investors Services, LLC, the securities attorneys of The White Law Group may be able to help. To speak with a securities attorney, please call the firm’s Chicago office at 312/238-9650.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida.
For more information on The White Law Group, please visit our website at http://www.whitesecuritieslaw.com.
Investigation into Potential Recovery of Aaron Vallett Investment Losses
The White Law Group is announcing an investigation into the potential for investors who suffered investment losses due to their dealings with Aaron Vallett, a former financial advisor from Tennessee, to recover their losses through the Financial Industry Regulatory Authority (FINRA) dispute resolution process.
It was recently reported that Aaron Vallett has been charged with fraud. According to information available on the U.S. Department of Justice website Vallett “was a financial advisor who owned his own firm in Brentwood, Tennessee and offered various financial services, including investment advice and 401(k) management.” They allege that through his business Vallet “defrauded numerous clients of approximately $5 million dollars. Much of the loss came from investor-clients who placed money in one of Vallett’s investment “Funds.” Instead of investing that money as promised, Vallett kept it in his company’s operating account and spent it on various personal and business expenses.” The Justice Department further reported that he is alleged to have transferred some monies out of investor’s 401(k) accounts and used them for his own expenses. Bizjournals.com reported that Vallett “is accused of operating a ponzi scheme from September 2008 to July 2010.”
According to the Financial Industry Regulatory Authority (FINRA) CRD, Aaron Donald Vallett was registered with FINRA member firms from December 2001 until June of 2010. He was registered with firms in Tennessee from 2004-2010. He was registered with Cambridge Way, Inc. from 02/2004-07/2006, Synergy Investment Group, LLC from 06/2006-06/2008, and Institutional Capital Management, Inc. (ICM) from 11/2008- 06/2010. His report also indicates that he was terminated from his position at Institutional Capital Management (ICM) on 6/11/2010.
When a FINRA affiliated broker conducts business outside of the firm with whom he is registered the activity may be considered “selling away.” If a registered broker “sells away” from his firm, the firm may still be liable for negligent supervision of their broker representative and may be responsible for investment losses in a FINRA dispute resolution claim.
If you invested with Aaron D. Vallett while he was registered with a FINRA member brokerage firm, suffered investment losses and would like to speak to a securities attorney about your potential to recover losses through Financial Industry Regulatory Authority (FINRA) arbitration please call our Chicago office at 312-238-9650.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida.
For more information on The White Law Group, please visit our website at http://www.whitesecuritieslaw.com.
Study Shows Many Financial Professionals Misrepresenting Their Expertise
According to a recent study, it appears that many financial professionals “tend to overstate their qualifications and services.” The investmentnews.com recently reported on the study done by Cerulli Associates Inc. in which they studied the responses of upwards of 1,500 “financial intermediaries.” A Cerulli analyst, Mr. Scott Smith, was quoted in the article as saying, “Most advisers don’t want to say that they don’t offer some kind of service, so they are more likely to overstate their capabilities.”
The reason for this “pattern of misrepresentation” has to do with differences in designations for financial professionals. Mr. Smith told the investmentnews.com that “We found that 59% of respondents were calling themselves full-scale financial planners, when it fact many of them were actually investment planners.” The study found that only 30% of those financial professionals fit Cerulli’s definition of a “financial planner.”
The article notes that financial planners generally “…[work] with clients to build comprehensive plans that include insurance and estate planning.” Alternatively, investment planners “focus on asset management, retirement and college savings plans but tend to offer more-modular-style plans.” Only 22% of industry respondents called themselves investment planners while according to Cerulli and Mr. Smith “56% of respondents are actually investment planners.”
Mr. Smith reportedly told the investmentnews.com that he believed that the “discrepancy could be attributed to that fact a lot of advisers view themselves as being more comprehensive than they actually are, simply because they believe they have the potential to be more comprehensive.” Cerulli’s study does not seem to indicate any willful fraud on the part of the financial professionals, but it does seem to indicate a need for investors, and others seeking financial advice, to ask plenty of questions and do significant research when deciding which financial professional to choose.
The full text of the investmentnews.com article can be found here: http://www.investmentnews.com/article/20120119/FREE/120119908
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida.
If you have suffered investment losses, are concerned that you may be the victim of investment fraud, and would like to speak to a securities attorney about your potential investment loss recovery options please call our Chicago office at 312-238-9650.
For more information on The White Law Group, please visit our website at http://www.whitesecuritieslaw.com.
Potential Recovery of Kale Edgar Evans Investment Losses
Have you suffered investments losses or fear you have been the victim of securities fraud due to your investment with Kale Edgar Evans while he was registered with a Financial Industry Regulatory Authority (FINRA) member firm? If so, The White Law Group may be able to assist you recover your damages through the FINRA dispute resolution process.
According to the sandiegoreader.com, FINRA has taken action against Mr. Kale Edgar Evans and he has been “banned…from association with FINRA members and [has been ordered] to pay a fine.” The sandiegoreader.com reports that FINRA alleges that Mr. Evans “recommended unsuitable investments, including some made on margin, then engaged in excessive trading (churning).” Kale Edgar Evans’ alleged victim “was a teenager supporting three siblings” and he is accused of “[inducing] the youth to transfer $400,000 of her late father’s life insurance money to an account at Evans’s brokerage, with the promise that the money would be placed in a savings account with no risk.” However, after transfer of the funds, it is alleged that he dodged his firm’s oversight and “‘unethically’ transferred $128,000 from a bank account he shared with the customer to his personal accounts and to pay creditors.”
According to the Financial Industry Regulatory Authority (FINRA) CRD for Kale Edgar Evans, he was registered with FINRA member firm First Allied Securities, Inc. from 12/2007 until 01/2010. Before his employment with First Allied Securities, his CRD states that he registered with two other member firms, TD Waterhouse Investor Services, Inc. and Jack White & Company, Inc. In some cases brokerage firms may be liable for investment losses due to negligently supervising the fraudulent or inappropriate actions of their employees.
If you believe that you have suffered investment losses due to your relationship with Mr. Kale Edgar Evans and would like to speak to a securities attorney about your potential ability to recover investment losses through FINRA securities arbitration please call our Chicago office at 312-238-9650.
The White Law Group, LLC is a securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida.
For more information on The White Law Group, please visit our website at http://www.whitesecuritieslaw.com.
Hantz Financial Services, Inc. fined by FINRA
Hantz Financial Services, Inc. (CRD #46047, Southfield, Michigan) recently submitted a Letter of Acceptance, Waiver and Consent in which the firm was censured and fined $50,000.
Without admitting or denying the findings, the firm consented to the described sanctions and to the entry of findings that the firm failed to establish and maintain an adequate supervisory system to ensure that it immediately recorded on the firm’s books and records checks its customers mailed to the firm. The findings stated that supervisory system deficiencies were exploited by a registered representative who embezzled approximately $2.6 million from customers and contributed to the firm’s failure to detect his scheme; the representative exploited the firm’s check handling procedures by taking control of customer checks totaling approximately $850,000 and depositing the customer funds into his own bank accounts, without the checks being logged in the firm’s tracking system.
FINRA registered broker-dealers are responsible for supervising their agents and can be help liable for the actions of these agents if it can be demonstrated that the proper supervision could have discovered the improper actions of the agent.This information which is publicly available on FINRA’s website has been provided by The White Law Group, LLC.
If you have questions about investments you made with Hantz Financial Services, Inc., the securities attorneys of The White Law Group may be able to help. To speak with a securities attorney, please call the firm’s Chicago office at 312/238-9650.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida.
For more information on The White Law Group, please visit our website at http://www.whitesecuritieslaw.com.