Posts tagged ‘FINRA arbitration’
Investigation into Thomas Redmond Jr., and Potential Recovery of Investment Losses
The White Law Group is investigating potential claims against Indiana financial advisor, Thomas Redmond Jr., on behalf of investors that suffered significant losses. If you suffered losses as a result of your dealings with Thomas Redmond Jr.,you may be able to recovery your losses through the Financial Industry Regulatory Authority (FINRA) dispute resolution process.
On March 1, 2013 the Indiana Secretary of State released a press statement (here) that Thomas Redmond, Jr. was charged with ten counts of Securities Fraud related to a financial scheme that defrauded a number of elderly clients. Redmond allegedly began operating this Ponzi scheme in 2004 and has admitted to using clients funds for personal use. “He told those clients that he would invest the funds for them in various securities, but would instead deposit the funds into his personal account and use the funds for his personal living and business expenses.”
Redmond allegedly used his Christian faith to gain the trust of several victims and secure their investments. According to Secretary Lawson, “This case is particularly devastating as it involves the most trusting of victims: elderly widows who knew Redmond through church and a pair of missionaries who spent their life’s work overseas counseling survivors of Auschwitz.”
To conceal the Ponzi scheme, Redmond allegedly sent fraudulent statements to his victims and made returns to some clients using funds from other victims. In addition, Redmond failed to inform his clients and employer that he was barred from selling securities by FINRA in 2011.
According to his BrokerReport provided by FINRA’s Central Registration Depository (CRD), Redmond was a registered broker with FINRA from February 2000 to October 2009 in various states. He worked in Ohio with Tower Equities, Inc., from 01/2000-12/2000. Redmond worked in Wisconsin SII Investments Inc. from 03/2001-03/2002. He worked in Nebraska with Freedom Financial, Inc., from 03/2002-11/2003. Redmond than spent over two years working in Florida with Empire Financial Group, Inc., from 11/2003-08/2005. He worked for two Indian firms, Capital Financial Services, Inc., from 01/2005-11/2007 and Next Financial Group, Inc. from 12/2007-10/2009.
While at Next Financial Group, Redmond became a registered Investment Adviser Representative, and continued working as a registered Adviser until 2012. Redmond worked briefly with Vantage Advisors, LLC from 03/2010-04/2010. He worked with Provident Capital Management, Inc. from 11/2010-06/2012.
According to the CRD, Redmond entered into an Acceptance, Waiver & Consent in 2011 that permanently barred him from selling securities. The allegations made by FINRA included making unsuitable investment recommendations, misrepresenting investments, and forging client’s signatures.
Brokerage firms have a supervisory responsibility to monitor the conduct and investment activities of their employees. A broker that sells or solicits the sale of securities outside of the firm he works with, it may be considered “selling away” and violates FINRA rules. When a broker lies, steals and deceives clients to sell securities, like Redmond, the brokerage firm may be liable for investment losses through a FINRA dispute resolution claim.
If you are concerned about investments made with Thomas Redman Jr., between 2000-2009 and would like to discuss your litigation options to recover losses, please call the securities attorneys of The White Law group at 312-238-9650 for a free consultation.
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 http://www.whitesecuritieslaw.com.
Marc Duda to be Sentenced for Fraud in Federal Court
According to the Orange County Register, Marc Duda, a former financial adviser, had his sentencing related to charges that he “…bilk[ed] investors out of more than $2.5 million…” continued in February and rescheduled for March 26th. Prosecutors in the case are said to be seeking 63 months in prison. The White Law Group is investigating the potential for investors who suffered losses as a result of working with Marc Duda to recover their investment losses through the Financial Industry Regulatory Authority (FINRA) dispute resolution claims process.
Marc Duda, says the Orange County Register, “…used money from more than 10 investors to live an apparent extravagant lifestyle, including buying airplanes.” It also appears that Marc Duda used investor funds as a return to other investors. The fraudulent activities reportedly took place between March 2008 and July 2011.
During the time of the alleged fraud, Marc Duda was a FINRA registered representative of Geneos Wealth Management, Inc. According to the FINRA CRD for Mr. Duda, he was registered with Geneos Wealth Management from 01/2005 until 08/2011. The report also indicates that he was “terminated” from Geneos Wealth Management “when the firm learned that he was under investigation by the Federal Bureau of Investigation for allegedly taking money from clients and placing it into investments run by the representative and from which the representative took money allegedly for personal expenses.”
When a FINRA registered representative conducts business outside of the firm with whom he is registered, that 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 claim.
If you have suffered losses due to your investment with former financial adviser Marc Duda and would like to speak to a securities attorney about your potential to recover those investment losses through the FINRA arbitration process, please call The White Law Group’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.
Former LPL Financial Advisor in Ohio Pleads Guilty to Fraud
According to the Cincinnati Business Courier, Elliot Kravitz, a financial advisor in Mason, Ohio, recently pleaded guilty to one count of wire fraud for an investment scheme in which he defrauded nine of his customers out of more than $2 million.
Kravitz could face up to 20 years in prison and a fine of up to $250,000. He is scheduled to be sentenced Aug. 23. In addition, the judge could order Kravitz to pay restitution of the more than $2 million.
According to his plea agreement, Kravitz was an independent client investment representative with LPL Financial Corp., formerly Waterstone Financial Corp., and sold securities through those financial institutions. In July 2007, Kravitz advised a client to pull money out of the stock market and invest it in a real estate investment trust. The client signed a distribution form allowing Kravitz to move the money. Instead of investing it in the trust, Kravitz put the money into an account he controlled. He made 12 more withdrawals totaling $713,765 from the client’s account.
Kravitz then sent the client a year-end account portfolio statement listing the fake real estate investment. He purportedly diverted approximately $1.12 million from eight other clients for personal use.
The White Law Group is currently investigating the potential for clients of Kravitz to recover a portion of their losses in claims against his employer.
Even if a financial advisor is conducting business without the knowledge of his employer, the firm may still be liable for negligent supervision of their broker representative and may be responsible for investment losses in a FINRA arbitration claim.
If you have suffered losses due to your investment with Kravitz and would like to speak to a securities attorney about your potential to recover those investment losses, please call The White Law Group’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.
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.
Expert Says Some Brokerage Firms Performed Poor Private Placement Due Diligence
A recent article by Bruce Kelly of the investmentnews.com reported the opinion of Gordon Yale, a forensic accountant, who has served as an expert for dozens of investors who have brought claims against brokerage firms related to the sale of failed private placement investments issued by companies like DBSI, Inc., Medical Capital Financial Corp., and Shale (Provident) Royalties. In Mr. Yale’s expert opinion, “Broker-dealers that sold billions of dollars in allegedly fraudulent private placements failed massively in their due-diligence responsibilities to investors.”
Yale likened the due diligence failures of firms that sold these private placements to the failures of large banks to perform due diligence on bad mortgage backed securities that led to the mortgage crisis. He said, “It was basically the same recklessness…but it was done by middle- or lower-tier firms and [with] a different set of products.”
Certainly, firms that sold these investments contend that they did do adequate due diligence. However, recent arbitration awards as well as fines and sanctions issued by securities regulators like the Financial Industry Regulatory Association (FINRA) indicate that they are at least skeptical of the due diligence work performed. Kelly notes that FINRA recently fined the former president of Capital Financial Services $10,000 related to the sale of Medical Capital and Provident Royalties. He also noted that only one of the cases that Yale has worked on necessitated his testimony in arbitration (many settled in advance of arbitration) and in that case a $1.2 million award was ordered to be given to an investor by Securities America Inc. and a broker.
In the investmentnews.com piece Yale indicated his opinion that firms too often relied on 3rd party due diligence reports, he said, “They viewed those reports as the end of the process, rather than the beginning. There’s a notice to [Finra] members, 05-48, that basically says you can outsource any function, but you can’t outsource your responsibility for compliance with federal securities laws or regulations.” Yale feels like firms, especially one’s like Securities America who sold $700 million in Medical Capital notes, should have hired an independent CPA to conduct financial due diligence on the investments.
The White Law Group is all too familiar with the difficulties investors have had over the last several years with failed private placements. The firm has represented and currently represents many investors who have suffered damages as a result of the recommendation of their financial professional to purchase private placement investments from companies like DBSI, Medical Capital, and Shale (Provident) Royalties. We have found that in many cases the FINRA registered firms failed in their fiduciary duty to perform adequate due diligence and to disclose the risks involved with these investments. Brokerage firms that fail in this fiduciary duty may be liable in FINRA dispute resolution claims to recover investment losses.
If you are concerned about an investment you made in a private placement like those from DBSI, Medical Capital, and Shale (Provident) Royalties and would like to speak to an attorney about your potential to recover investment losses through a FINRA claim please call out 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.