According to thepolicenews.net, Texas Securities Commissioner revoked the registrations of Corpus Christi resident, Kenneth Wayne Graves, for allegedly making unsuitable investment recommendations that cost investors nearly $450,000. In addition, the Commissioner shut down the advisory firm he operated, Warren Financial Services (WFS).
Allegedly, “Graves sold a security that promised to pay between 2.5% and 5% of WFS’ monthly gross income for periods of between three and seven years.” However, it is alleged that investors were underpaid and that some investors did not receive monthly payments at all.
Furthermore, Graves is accused of charging investors fees much higher than the 2% fee listed in the investment agreement. He is also accused of making unauthorized withdrawals from investors’ custodial accounts totaling more than $130,000.
Graves and WFS charged clients fees that were much higher than the 2% annual management fee listed in its investment management agreement. Graves also made unauthorized withdrawals of $138,381 in advance management fees from clients’ custodial accounts.
According to BrokerCheck, Graves was a registered representative for First Command Financial Planning from 08/2008 – 10/2010. He was employed at the firm until he was terminated in 03/2012.
Broker dealers have a responsibility to oversee the business activity of their employees, even business conducted outside the firm. When a broker operates an advisory firm that conducts transactions outside the scope of the broker dealer they are registered with, the act may be considered “selling away.” If the broker “sells away” the broker dealer may be liable for negligent supervision and responsible for investment losses.
If you worked with Kenneth Wayne Graves and suffered significant investment losses, The White Law Group may be able to help. To speak with a securities attorney about your litigation options, please call (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 Franklin, Tennessee.
For more information on the firm, visit www.WhiteSecuritiesLaw.com.