Corporate & Securities Law

FINRA Expels Provident Asset Management, Related Entity To Provident Royalties, As SNSFE Continues Investigating Offers And Sales By Affliated Brokerage Firms

Posted on March 31, 2010
FINRA, the Financial Industry Regulatory Authority, has announced that it has expelled Provident Asset Management, LLC, a Dallas-based broker-dealer, for marketing a series of fraudulent private placements offered by its affiliate, Provident Royalties, LLC, in a massive Ponzi scheme...

SEC Comments On Pending Legislative Initiatives Impacting Investment Advisers And Investors

Posted on March 26, 2010
SEC Commissioner Elisse Walter recently spoke before the Investment Adviser Compliance Forum and shared her thoughts as to the legislative initiatives currently before Congress. Several initiatives would greatly impact investment advisers and investors...

More Movement Among And Between Transitioning Independent Firm Reps

Posted on March 24, 2010
According to InvestmentNews, more than 1/3 of the 3,531 registered representatives who changed firms last month came from independent broker-dealers. The bulk of the brokers, 68%, moved to other independent brokers, according to Discovery, a database firm...

SEC Comments On Pending Legislative Initiatives Impacting Investment Advisers And Investors

Posted on March 24, 2010
SEC Commissioner Elisse Walter recently spoke before the Investment Adviser Compliance Forum and shared her thoughts as to the legislative initiatives currently before Congress. Several initiatives would greatly impact investment advisers and investors...

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More Movement Among And Between Transitioning Independent Firm Reps

Posted on March 24, 2010
According to InvestmentNews, more than 1/3 of the 3,531 registered representatives who changed firms last month came from independent broker-dealers. The bulk of the brokers, 68%, moved to other independent brokers, according to Discovery, a database firm...

Schwab Hit With Large Employee U-5 Defamation And Wrongful Termination Award

Posted on March 22, 2010
According to InvestmentNews, a FINRA arbitration panel last month ordered Charles Schwab to pay a former employee $1.8 million in back pay and punitive damages. Dow Jones Newswires first reported the award last week. According to that report, Mr. Leahy,...

Schwab Hit With Large Employee U-5 Defamation And Wrongful Termination Award

Posted on March 22, 2010
According to InvestmentNews, a FINRA arbitration panel last month ordered Charles Schwab to pay a former employee $1.8 million in back pay and punitive damages. Dow Jones Newswires first reported the award last week. According to that report, Mr. Leahy,...

Bogus And Non-Detailed Annual Review Letters To Defrauded Investors Lands First Allied Securities A $1.95 Million SEC Fine

Posted on March 17, 2010
The SEC has charged First Allied Securities with failing to supervise a broker who defrauded two Florida municipalities. First Allied Securities has agreed to settle the SEC's findings by paying $1.95 million. The SEC charged the firm's former broker, Harold...

Bogus And Non-Detailed Annual Review Letters To Defrauded Investors Lands First Allied Securities A $1.95 Million SEC Fine

Posted on March 17, 2010
The SEC has charged First Allied Securities with failing to supervise a broker who defrauded two Florida municipalities. First Allied Securities has agreed to settle the SEC's findings by paying $1.95 million. The SEC charged the firm's former broker, Harold...

Regulator's Action Against Securities America Underscores Need To Be Wary Of Private Placements

Posted on March 09, 2010
Recently the state securities regulator for Massachusetts filed an administrative complaint against Securities America in connection with its sale of promissory notes issued by special purpose corporations wholly owned by Medical Capital Holdings, Inc...

SNSFE Investigates Rhonda Breard And ING Financial For Fraud Over Extensive Investment Losses

Posted on March 05, 2010
SNSFE attorneys are investigating ING Financial and the firm's adviser, Rhonda Breard. Ms. Breard purportedly has converted $8 million from ING clients for her own personal use and to maintain an extremely lavish lifestyle. She issued bogus statements created for...

SNSFE Investigates Rhonda Breard And ING Financial For Fraud Over Extensive Investment Losses

Posted on March 05, 2010
SNSFE attorneys are investigating ING Financial and the firm's adviser, Rhonda Breard. Ms. Breard purportedly has converted $8 million from ING clients for her own personal use and to maintain an extremely lavish lifestyle. She issued bogus statements created for...

Lawsuit Among Protocol Signatories Underscores Need For Brokers To Retain Counsel To Guide Them In Their Transitions From Firm To Firm

Posted on March 03, 2010
Morgan Stanley has filed a lawsuit against 5 of its brokers who left the firm to join HighTower Advisors. HighTower denies any liability, calling the legal action a failed intimidation tactic. The suit claims that the brokers told clients of...

Lawsuit Among Protocol Signatories Underscores Need For Brokers To Retain Counsel To Guide Them In Their Transitions From Firm To Firm

Posted on March 03, 2010
Morgan Stanley has filed a lawsuit against 5 of its brokers who left the firm to join HighTower Advisors. HighTower denies any liability, calling the legal action a failed intimidation tactic. The suit claims that the brokers told clients of...

SNSFE Investigates Lawrence Lee Loomis And John Hagener In Connection With SEC Allegations Of A $10 Million Fraud

Posted on February 24, 2010
The Securities and Exchange Commission has charged two Sacramento-area men with misappropriating approximately $10 million from more than 100 investors who were falsely promised that their money would be loaned to homebuyers and secured by real estate deeds of trust...

Massachusetts Securities Regulator Files Complaint Against Securities America For Its Role In Selling Medical Capital Private Placements To Investors

Posted on February 17, 2010
In a complaint filed, the Massachusetts Securities Division says that Securities America misled investors when it sold millions in private placement securities for a company that purchased medical receivables. That company is known as Medical Capital...

Massachusetts Securities Regulator Files Complaint Against Securities America For Its Role In Selling Medical Capital Private Placements To Investors

Posted on February 17, 2010
In a complaint filed, the Massachusetts Securities Division says that Securities America misled investors when it sold millions in private placement securities for a company that purchased medical receivables. That company is known as Medical Capital...

Transition Support Tops List Of Improvements B-Ds Should Make

Posted on February 12, 2010
VVV Research and Development Inc. for Cambridge Investment Research has conducted a national survey asking 648 representatives about their experience with their broker-dealers. The transition support received when an adviser moves to a new broker-dealer tops the list of the...

Surprise Audit Requirements For Investment Advisers Serving As Trustees Quickly Approaches

Posted on February 12, 2010
Investment advisory firms that act as trustees and have some form of asset custody are weighing whether to continue offering the services in light of new SEC rules that include mandated surprise audits and go into effect March 12. The...

Transition Support Tops List Of Improvements B-Ds Should Make

Posted on February 12, 2010
VVV Research and Development Inc. for Cambridge Investment Research has conducted a national survey asking 648 representatives about their experience with their broker-dealers. The transition support received when an adviser moves to a new broker-dealer tops the list of the...

Surprise Audit Requirements For Investment Advisers Serving As Trustees Quickly Approaches

Posted on February 12, 2010
Investment advisory firms that act as trustees and have some form of asset custody are weighing whether to continue offering the services in light of new SEC rules that include mandated surprise audits and go into effect March 12. The...

Securities Regulator Issues Guidance To Firms And Brokers As To Communications On Social Networking Web Sites

Posted on February 11, 2010
FINRA (the Financial Industry Regulatory Authority) recently announced new guidance as to the obligations of financial services firms and their brokers related to their use of social networking sites such as Facebook, Twitter, LinkedIn and blogs to communicate with the...

Raymond James Ordered To Pay $12 Million In Raiding Case

Posted on February 09, 2010
In a case involving 20 advisers in 4 branch offices, a securities arbitration panel has ordered Raymond James Associates Inc. to pay $12.1 million to Wells Fargo Advisors LLC for alleged raiding. The award does not provide any detail of...

Raymond James Ordered To Pay $12 Million In Raiding Case

Posted on February 09, 2010
In a case involving 20 advisers in 4 branch offices, a securities arbitration panel has ordered Raymond James Associates Inc. to pay $12.1 million to Wells Fargo Advisors LLC for alleged raiding. The award does not provide any detail of...

State Street Charged And Settles Charges Relating To Its Pump And Dump Fraud In Connection With Subprime Mortgage Investments

Posted on February 05, 2010
The SEC has charged State Street for misleading investors about subprime mortgage investments and the Boston-based firm has agreed to settle those charges by repaying fund investors more than $300 million. State Street has agreed to settle the SEC's charges...

Disbarred Advisers Sue State Securities Regulators For Wrongful Prosecution

Posted on January 28, 2010
Two former financial advisers who were barred from the securities industry have sued Utah for $357 million, accusing state regulators of targeting them without proof of wrongdoing in an overzealous campaign to bring down securities violators according to a recent...

Disbarred Advisers Sue State Securities Regulators For Wrongful Prosecution

Posted on January 26, 2010
Two former financial advisers who were barred from the securities industry have sued Utah for $357 million, accusing state regulators of targeting them without proof of wrongdoing in an overzealous campaign to bring down securities violators according to a recent...

Former SunTrust Robinson Humphrey Rep Wins Defamation Case Involving False Pretense Of Auction Rate Security Complaint

Posted on January 22, 2010
A former SunTrust Robinson Humphrey broker has won $4 million in a defamation claim against the firm. The award includes $2.5 million in punitive damages for the representative. Such large punitive awards are unusual in arbitrations. In a written ruling,...

Former SunTrust Robinson Humphrey Rep Wins Defamation Case Involving False Pretense Of Auction Rate Security Complaint

Posted on January 21, 2010
A former SunTrust Robinson Humphrey broker has won $4 million in a defamation claim against the firm. The award includes $2.5 million in punitive damages for the representative. Such large punitive awards are unusual in arbitrations. In a written ruling,...

Elder Abuse And Reverse Mortgage Cited In Punitive Damages Award Against StockCross Financial Services

Posted on January 20, 2010
In a rarity, arbitrators last month cited elder abuse in tripling the damages a discount-securities firm must pay to a 95-year-old client. A FINRA panel awarded the investor $1.6 million in a case involving StockCross Financial Services, Inc. of Beverly...

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