The White Law Group, LLC, a South Florida securities fraud, broker fraud, securities arbitration, investor protection and Chapter 7 bankruptcy law firm based in Boca Raton, Florida.

Posts tagged ‘Chicago securities attorney’

Investigation into Fisker Automotive Investment Losses

Deutsche Bank Securities Inc. fined by FINRA

Deutsche Bank Securities Inc. (CRD #2525, New York, New York) recentlysubmitted a Letter of Acceptance, Waiver and Consent in which the firm was censured, fined $175,000, and required to pay $10,314.44, plus interest, in restitution to customers.

Without admitting or denying the findings, the firm consented to the described sanctions and to the entry of findings that it sold corporate bonds to customers and failed to sell such bonds at a price that was fair, taking into consideration all relevant circumstances, including market conditions with respect to each bond at the time of the transaction, the expense involved and that the firm was entitled to a profit. The firm submitted to FINRA on settlement dates, short-interest position reports that included incorrect short interest positions in numerous stocks.

The findings further stated that the firm transmitted to the FINRA/NASDAQ Trade Reporting Facility (FNTRF) last sale reports of transactions in designated securities, and failed to designate through the FNTRF such last sale reports as reflecting a price different from the current market when the execution was based on a prior reference point in time.

The findings also included that the firm failed to report the correct trade time to the RTRS in municipal securities transaction reports. The firm failed to report information regarding purchase and sale transactions effected in municipal securities to the RTRS in the manner prescribed by MSRB Rule G-14 RTRS Procedures and the RTRS Users Manual; the firm failed to report information about such transactions within 15 minutes of trade time to an RTRS portal. The firm improperly reported information to the RTRS that it was not required to report; the firm improperly reported to the RTRS certain purchase and sale transactions effected in municipal securities that the firm had already reported to the RTRS or were stepouts and thus, were not inter-dealer transactions reportable to the RTRS. The firm failed to show the correct execution time on brokerage order memoranda in municipal securities.

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 Deutsche Bank Securities 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.

Ongoing Investigation into Sala-Multi Series Fund and Foresee Strategies Insurance Fund

The White Law Group continues to investigate potential FINRA arbitration claims against the broker-dealers that may have improperly sold Sala-Multi Series Fund and Foresee Strategies Insurance Funds.

The hedge funds, Foresee Strategies Insurance Fund, were issued by Sun Life Financial as variable annuity subaccounts to Sala-Multi Series Fund and than sold to investor by various broker-dealers such as SagePoint Financial Inc, Geneos Wealth Management Inc, Lincoln Financial Network, National Planning Corp, and FSC Securities Corp.

Foresee Strategies Insurance Fund suffered devastating losses and was shut down in 2010. According to Investment News, “FINRA is investigating half a dozen independent broker-dealers that sold variable annuities with subaccounts invested in hedge funds that resulted in $18 million in client losses during the credit crisis.”

In addition, Sun Life Financial, according to their own web site is in the processes of selling their U.S. annuity business to Delaware Life holdings.  Sun Life Financial president, Dean A. Connor stated that “This transaction represents a transformational change for Sun Life. It significantly advances our strategy of reducing Sun Life’s risk profile and earnings volatility, focuses our U.S. operations on our areas of greatest strength and opportunity, and crystallizes future earnings and capital releases that will further support our growth and shareholder value creation. “

Upon information and belief many investors were unaware of risks or mislead by the broker-dealer that sold them the annuity investment. However, investors may be able to recovery their losses through FINRA arbitration against their broker-dealer or financial advisor.

Arbitration claims against broker- dealers often involve unsuitability, misrepresentation, and omission of facts. Broker-dealers and financial advisors have a fiduciary duty to make investment recommendations that are suitable for potential clients based on such factors as age, risk tolerance, and financial need.

Broker-dealers and financial advisors are legally obligated do disclose all the risks of the investment, and perform a reasonable investigation of the investment prior to making recommendations.

If you invested in the Sala-Multi Series Fund or Foresee Strategies Insurance Funds Financial would like to speak to a securities attorney about your litigation options, 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.

SEC charges Advanced Equities with misrepresenting two private equity offerings.

The Securities and Exchange Commission recently charged the co-founder of a Chicago-based investment firm with misleading investors in two private equity offerings, and charged the other co-founder with supervisory failures related to the offerings.

Advanced Equities Inc. – a broker-dealer and investment advisory firm – and co-founders Dwight O. Badger and Keith G. Daubenspeck were charged in connection with private offerings in 2009 and 2010 on behalf of an alternative energy company in Silicon Valley, Calif.  According to the SEC release, Badger led the sales effort for the offerings and made misstatements about the energy company’s finances that Advanced Equities failed to correct, thus failing to reasonably supervise Badger.

According to the SEC’s order on this matter, Badger made a variety of misstatements in selling the alternative energy company investment.  Specifically, the SEC stated that Badger (1) said in the 2009 offering that the energy company had more than $2 billion of order backlogs when the backlog never exceeded $42 million, (2) that it had a $1 billion order from a national grocery store chain even though the store only had placed a $2 million order and signed a non-binding letter of intent for future purchases, (3) that the company had been granted a U.S. Department of Energy loan exceeding $250 million when it had applied for a $96.8 million loan, and (4) he misstated the information about the loan application during the follow-up offering in 2010.

According to the SEC’s order, Daubenspeck participated in at least two internal sales calls with Advanced Equities brokers during the 2009 offering and remained silent after he heard Badger make misstatements about the company’s order backlog, grocery store order, and Department of Energy loan application.  Despite the red flags raised by the misstatements and the obvious risk that false information would be repeated to investors, the SEC claimed that Daubenspeck did not take reasonable steps to correct the misstatements and thus failed reasonably to supervise Badger.

In resolving the SEC’s investigation, Advanced Equities agreed to pay a $1 million penalty, and agreed to be censured and to cease and desist from committing or causing any future violations of the securities laws it was found to have violated.  The firm also agreed to numerous undertakings including hiring an independent consultant to review its sales policies and procedures.  Badger agreed to pay a $100,000 penalty and be barred for one year from association with any broker, dealer, investment adviser, municipal securities dealer or transfer agent.  Daubenspeck agreed to pay a $50,000 penalty and a one-year supervisory suspension.  Advanced Equities, Badger, and Daubenspeck consented to the entry of the cease-and-desist order without admitting or denying the SEC’s charges.

Although the SEC notice fails to identify the alternative energy company, other reports indicate that Advanced Equities was served in January with a Wells Notice related to its sale of a Fisker Automotive offering in 2009.

The White Law Group is investigating the liability that Advanced Equities may have for losses sustained by investors in the alternative energy company.  Investors may be able to recover those losses through FINRA arbitration.

To speak with a securities attorney regarding the litigation options, please call The White Law Group’s Chicago office 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 Chicago, Illinois and Boca Raton, Florida.  The firm represents investors in disputes with their financial professional or brokerage firm.

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

Cambridge Legacy Securities Files Bankruptcy

Another seller of high-risk private placements has withdrawn from FINRA.  According to reports, on April 13, Cambridge Legacy Securities LLC filed its broker-dealer withdrawal request with the Financial Industry Regulatory Authority Inc.  A few days later, the firm also filed for bankruptcy protection in the U.S. District Court for the Northern District of Texas in Dallas. (The bankruptcy filing was a Chapter 7 no asset bankruptcy.)

In late March, a Finra arbitration panel had awarded a former customer of the firm over $1.6 million in a claim involving private placements.  It is this award the presumably precipitated the demise of the broker-dealer.   Other on-going arbitration claims against Cambridge Legacy Securities have been stayed by the bankruptcy and these investors who were seeking to recover losses in private placement investments also recommended by Cambridge must now decide whether to move to lift the bankruptcy stay in order to attempt to keep their claims against the firm going.

The bankruptcy filing by Cambridge Legacy Securities highlights a growing problem in the securities industry – the under-capitalization of small broker-dealers and the lack of errors and omissions insurance carried by many of these brokerage firms.  As it stands today, brokerage firms are required by FINRA to have only a small amount of “net capital” and there is no regulatory requirement that firms carry insurance.  This results in the same basic progression of events as appears to have occurred with Cambridge.  A firm sells high-risk, high-commission products, and as soon as it losses a significant arbitration award, the firm simply withdraws its FINRA membership.

Based on reports in the Investment News, it appears that Cambridge may actually be planning to continue to operate as an RIA called Cambridge Legacy Advisors Inc., so despite the brokerage firm’s withdrawal from FINRA and the bankruptcy filing of the broker-dealer, the firm could continue to service clients through its RIA.

The foregoing information has been provided by The White Law Group.  The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Boca Raton, Florida.

For more information on the securities attorneys of The White Law Group and the firm’s representation of investors in securities fraud claims, visit http://www.whitesecuritieslaw.com.