Former Aegis Capital Broker Douglas Szempruch Under KlaymanToskes Investigation

Former Aegis Capital Broker Douglas Szempruch Under KlaymanToskes Investigation

National investor fraud law firm, KlaymanToskes (“KT”), has commenced an investigation into former Aegis Capital broker Douglas Szempruch in light of his recent suspension by FINRA. On July 9, 2021, FINRA disclosed that it suspended former Aegis Capital broker Douglas Szempruch relating to him recommending and effecting excessive and unsuitable trading, per a FINRA Letter of Acceptance, Waiver and Consent (AWC), Case # 2017054317401. What is a FINRA AWC? According to FINRA Rule 9216, if FINRA’s Department of Enforcement has reason to believe a member or associated person has committed a violation, and that member or associated person does not…

VXX Investor Through UBS? KlaymanToskes Investigates Firm's VXX Sales Practices in Light of Recent SEC Settled Action

VXX Investor Through UBS? KlaymanToskes Investigates Firm's VXX Sales Practices in Light of Recent SEC Settled Action

Invest with UBS and VXX ETN? The Securities and Exchange Commission recently settled charges against UBS Financial Services Inc. for its failure to supervise relating to sales of iPath S&P 500 VIX Short-Term Futures ETN (“VXX”) in UBS’s Portfolio Management Program (“PMP”). VXX is a volatility linked exchange-traded product. From January 2016 to January 2018, certain financial advisors in UBS’s discretionary Portfolio Management Program purchased and held VXX for their advisory clients for durations that were inconsistent with the purpose of the product, as described in its offering documents, and as described to UBS in a meeting with VXX representatives.…

Adam Belardino, Ex-MML Investors Services Rep., Named In FINRA Complaint

Adam Belardino, Ex-MML Investors Services Rep., Named In FINRA Complaint

FINRA recently named Adam Belardino of New Rochelle as a Respondent in a Complaint. FINRA alleges that Belardino failed to appear for on-the-record testimony. Belardino was employed at Barnum Financial Group in Elmsford, New York from 2007 to March 2019. During that time, Belardino was a registered representative for MML Investors Services, LLC, which is an affiliate of Massachusetts Mutual Life Insurance Co. He was terminated in March 2019 relating to his firm’s investigation into a customer complaint against him. Adam Belardino & FINRA Complaint The Complaint alleges that FINRA began investigating Belardino’s termination from MML Investors Services in April…

FINRA Bars Former Wells Fargo Broker Tyler Rigsbee

FINRA Bars Former Wells Fargo Broker Tyler Rigsbee

FINRA recently disclosed that it barred former Wells Fargo Clearing Services, LLC broker Tyler Rigsbee from associating with any FINRA member in all capacities relating to receiving client funds in his bank account without the clients’ authorization, per a FINRA Letter of Acceptance, Waiver and Consent (AWC), Case # 2021071026301. What is a FINRA AWC? According to FINRA Rule 9216, if FINRA’s Department of Enforcement has reason to believe a member or associated person has committed a violation, and that member or associated person does not dispute the violation, the Department of Enforcement may prepare and request that the member…

FINRA Orders Sanctuary Securities, Inc. to Pay $530K for Non-Traditional ETF Supervisory Failures

FINRA Orders Sanctuary Securities, Inc. to Pay $530K for Non-Traditional ETF Supervisory Failures

FINRA recently disclosed that Sanctuary Securities, Inc. (formerly known as David A. Noyes & Company) agreed to submit a Letter of Acceptance, Waiver and Consent (AWC) relating to its failure to supervise its solicited sales of inverse and leveraged exchange traded funds (Non-Traditional ETFs or NT-ETFs) in that the firm’s supervisory system was not sufficiently tailored to address the unique features and risks of these products. What is a Non-Traditional ETF? Non-traditional ETFs are designed to return a multiple of an underlying index or benchmark, the inverse of that benchmark, or both, over only the course of one trading session—…

FINRA Suspends Former Merrill Lynch Broker Scott Ryland Mathews for Early Rollovers of Unit Investment Trusts

FINRA Suspends Former Merrill Lynch Broker Scott Ryland Mathews for Early Rollovers of Unit Investment Trusts

FINRA recently disclosed that former Merrill Lynch broker Scott Ryland Mathews agreed to a Letter of Acceptance, Waiver and Consent (AWC), Case # 2018060359901, relating to engaging in an unsuitable pattern of early rollovers of Unit Investment Trusts (“UITs”). Because of the long-term nature of UITs, their structure, and their costs, short-term trading of UITs may be unsuitable. As discussed on our recent blog post, FINRA also recently disclosed that Merrill Lynch agreed to an Acceptance, Waiver and Consent (AWC), Case #2017053437701, relating to its failure to establish and maintain a supervisory system that was reasonably designed to achieve compliance…

FINRA Suspends Merrill Lynch Broker Kelly Feehrer for Early Rollovers of Unit Investment Trusts

FINRA Suspends Merrill Lynch Broker Kelly Feehrer for Early Rollovers of Unit Investment Trusts

FINRA recently disclosed that Merrill Lynch broker Kelly Wayne Feehrer agreed to a Letter of Acceptance, Waiver and Consent (AWC), Case # 2018060356501, relating to engaging in an unsuitable pattern of early rollovers of Unit Investment Trusts (“UITs”). Because of the long-term nature of UITs, their structure, and their costs, short-term trading of UITs may be unsuitable. As discussed on our recent blog post, FINRA also recently disclosed that Merrill Lynch agreed to an Acceptance, Waiver and Consent (AWC), Case #2017053437701, relating to its failure to establish and maintain a supervisory system that was reasonably designed to achieve compliance with…

NOTICE TO CLIENTS OF KEVIN MCCALLUM WITH LPL FINANCIAL: Klayman & Toskes, P.A. Commences Investigation of Former LPL Broker Kevin McCallum in Light of FINRA Suspension

NOTICE TO CLIENTS OF KEVIN MCCALLUM WITH LPL FINANCIAL: Klayman & Toskes, P.A. Commences Investigation of Former LPL Broker Kevin McCallum in Light of FINRA Suspension

National investor fraud law firm, KlaymanToskes (“KT”), has commenced an investigation in light of the recent Letter of Acceptance, Waiver and Consent (No. 2019062569501) submitted by Kevin McCallum (“McCallum”) to FINRA, who worked at LPL Financial (“LPL”) from May 2012 to July 2019. McCallum was also with Cadence Bank during the same time period in Birmingham, Alabama. According to FINRA, from May 2017 through June 2017, McCallum made unsuitable recommendations to 12 customers, resulting in their overconcentration in a high-risk, publicly traded business development company. During the same time period, McCallum sent emails to certain customers about the business development…

NOTICE TO ROBINHOOD FINANCIAL LLC INVESTORS – KlaymanToskes Commences Investigation for Robinhood Financial LLC (“Robinhood”) Investors With Losses in Excess of $100,000 Due to Firm’s Inappropriate Options Trading Approval

NOTICE TO ROBINHOOD FINANCIAL LLC INVESTORS – KlaymanToskes Commences Investigation for Robinhood Financial LLC (“Robinhood”) Investors With Losses in Excess of $100,000 Due to Firm’s Inappropriate Options Trading Approval

KlaymanToskes (“KT”) announces an investigation on behalf of investors who sustained losses in excess of $100,000 from the inappropriate options trading approval from Robinhood Financial LLC (“Robinhood”). On June 30, 2021, the Financial Industry Regulatory Authority (“FINRA”) disclosed  that Robinhood agreed to a Letter of Acceptance, Waiver and Consent relating, in part, to inappropriately approving customers for options trading. Specifically, since Robinhood began offering options in December 2017, the firm relied on flawed computer algorithms with only limited oversight by firm principals, which resulted in inappropriately approving thousands of customers who did not satisfy the firm’s eligibility criteria or whose…

FINRA Fines Independent Financial Group $200,000 for Failure to Supervise Alternative Investment Recommendations

FINRA Fines Independent Financial Group $200,000 for Failure to Supervise Alternative Investment Recommendations

Recently, the Financial Industry Regulatory Authority (FINRA) sanctioned and fined Brokerage Firm, Independent Financial Group (IFG), for the failure to supervise recommended Alternative Investments in Non-traded Real Estate Investment Trusts (REITs) and Structured Notes.  According to FINRA, the Acceptance Waiver and Consent (AWC) agreed to by IFG resulted in a censure, $200,000 fine and required to implement supervisory systems reasonably designed to comply with sales practice rules and regulations related to suitability requirements for alternative investment recommendations. Regulatory Findings According to FINRA investigations, “the representative solicited dozens of customers who were retiring or had retired to liquidate their 401(k) and…

Unit Investment Trust Early Rollovers at Merrill Lynch Prompt Millions in FINRA Fines

Unit Investment Trust Early Rollovers at Merrill Lynch Prompt Millions in FINRA Fines

FINRA recently disclosed that Merrill Lynch agreed to an Acceptance, Waiver and Consent (AWC), Case #2017053437701, relating to its failure to establish and maintain a supervisory system that was reasonably designed to achieve compliance with FINRA’s suitability rule as it pertains to early rollovers of Unit Investment Trusts (“UITs”). Because of the long-term nature of UITs, their structure, and their costs, short-term trading of UITs may be unsuitable. What is a Unit Investment Trust? A Unit Investment Trust is a SEC-registered investment company that offers investors shares or “units” in a fixed portfolio of securities in a one-time public offering.…

NORTHSTAR FINANCIAL SERVICES (Bermuda) INVESTMENT RECOVERY: KlaymanToskes Investigates Investor Losses

NORTHSTAR FINANCIAL SERVICES (Bermuda) INVESTMENT RECOVERY: KlaymanToskes Investigates Investor Losses

National investor fraud law firm, KlaymanToskes (“KT”), announces an investigation on behalf of investors in Northstar Financial Services (Bermuda) Ltd. following its recent bankruptcy and order to liquidate by the Bermuda government.   What is Northstar Financial Services (Bermuda) Ltd? Originally created in the 1990s, Northstar Financial Services was a Segregated Accounts Company regulated by the Bermuda Monetary Authority, and touted its fixed and variable annuities products as offering segregated account protection, generous liquidity terms and a variety of commitment periods, as well as the benefits of a Bermuda trust structure. Northstar Financial Services (Bermuda) had an international reach. As of…

Former LPL Financial Advisor Paul McGonigle Investigation

Former LPL Financial Advisor Paul McGonigle Investigation

National investor fraud law firm, KlaymanToskes (“KT”), has commenced an investigation in light of recent criminal charges concerning Paul R. McGonigle (“McGonigle”), who worked at LPL Financial (“LPL”) from February 2018 to June 2019. On June 9, 2021, the Department of Justice (“DOJ”) charged McGonigle with three counts of wire fraud, one count of mail fraud, and one count of aggravated identity theft in connection with defrauding elderly clients and stealing their retirement assets. In November 2020, Financial Industry Regulatory Authority barred McGonigle as a broker for failing to respond to a request for information via an expedited proceeding. According…

FINRA Fines VALIC Financial Advisors $350,000 for Failure to Supervise Variable Annuity Sales Practices

FINRA Fines VALIC Financial Advisors $350,000 for Failure to Supervise Variable Annuity Sales Practices

On January 8, 2021, VALIC Financial Advisors agreed to a Letter of Acceptance, Waiver and Consent (AWC) (Case No. 2018060548501)  which included a Fine of $350,000 by the Financial Industry Financial Authority (FINRA), the securities industry regulator established to protect investors.  According to the agreement with FINRA, VALIC Financial Advisors “consented to the sanctions and to findings that it failed to establish a reasonably designed system and written procedures for the surveillance of rates of variable annuity replacements and for corrective action in the case of inappropriate replacements”.  FINRA also determined. “The procedures also failed to provide guidance as to…

FINRA Fines Cetera $1 Million for Failure to Supervise Private Securities Transactions in Client Accounts

FINRA Fines Cetera $1 Million for Failure to Supervise Private Securities Transactions in Client Accounts

FINRA recently disclosed that Cetera Advisor Networks LLC, Cetera Advisors, LLC and Cetera Financial Specialists, LLC, (Cetera Firms) agreed to an Acceptance, Waiver and Consent (AWC) Case #2015046716901.  The Cetera Firms were fined $1 million and were ordered to review and revise, their systems, policies and procedures with respect to the supervision of “private securities” transactions in client accounts, for brokers who were dually-registered. According to FINRA, “From January 2011 through December 2018, Networks and Advisors, and from November 2012 through January 2018, Specialists (the relevant time periods) each failed to establish, maintain and enforce a supervisory system and written…

FINRA Orders Worden Capital Management LLC to Pay More than $1.2 Million in Restitution to Customers Whose Accounts Were Excessively Traded and Fined $350,000 for Failing to Reasonably Supervise Recommended Securities Transactions and Other Violations

FINRA Orders Worden Capital Management LLC to Pay More than $1.2 Million in Restitution to Customers Whose Accounts Were Excessively Traded and Fined $350,000 for Failing to Reasonably Supervise Recommended Securities Transactions and Other Violations

On December 31, 2020, FINRA announced today that it sanctioned Worden Capital Management LLC (WCM) more than $1.5 million, including approximately $1.2 million in restitution to customers whose accounts were excessively traded by the firm’s representatives, and a $350,000 fine for supervisory and other violations. As part of the settlement, WCM must also retain an independent consultant to conduct a comprehensive review of the relevant portions of the firm’s supervisory systems and procedures. According to the Acceptance, Waiver and Consent accepted and signed by Worden Capital Management, “FINRA found that from January 2015 to October 2019, WCM and the firm’s…

FINRA Barred, NPB Financial Group Ex-Broker, Cynthia Diane Cowden for Unsuitable Investment Recommendations in Illiquid Non-Traded Securities

FINRA Barred, NPB Financial Group Ex-Broker, Cynthia Diane Cowden for Unsuitable Investment Recommendations in Illiquid Non-Traded Securities

The securities industry watchdog, the Financial Regulatory Industry Authority (“FINRA”) barred, NPB Financial Group’s, Ex-Broker Cynthia Diane Cowden, for Unsuitable Investment Recommendations to a retired couple and an individual senior investor.  The recommended investments at issue were illiquid non-traded REITs and non-traded closed end funds.  According to FINRA, the barred broker’s recommendations resulted in unsuitable, securities concentration in illiquid securities that exceeded concentration limits established by the California State Regulations designed to protect investors. FINRA required that Cynthia Diane Cowden’s investment advice should have had reasonable basis for her recommendations, based on the investor’s “age, other investments, financial situation and…

NOTICE TO MERRILL LYNCH CUSTOMERS – Klayman & Tokses, P.A. Announces Investigation into Merrill Lynch Loan Management Accounts in Light of FINRA Sanctions for $7 Million in Fines and Restitution Regarding US and Puerto Rico Clients

New York, NY – December 1, 2016 — The Securities Arbitration Law Firm of Klayman & Toskes, P.A. (“K&T”), www.klaymantoskes.com, announces an investigation into Merrill Lynch, a wholly owned brokerage firm of Bank of America (NYSE:BAC), for Financial Industry Regulatory Authority (FINRA) sales practice violations from its Loan Management Accounts (LMAs) following FINRA regulatory fines.  Yesterday, FINRA accepted from Merrill Lynch an Acceptance Waiver and Consent for $6.25 million in fines and approximately $780,000 in restitution to Puerto Rico customers, for inadequately supervising the use of Merrill Lynch loans for customer accounts.  According to FINRA, Merrill Lynch brokerage accounts received proceeds transferred from LMAs and purchased millions of dollars…

FINRA Fines Broker $219,000 for Private Placement Violations

FINRA Fines Broker $219,000 for Private Placement Violations

Thomas Edward Brenner Jr. (CRD #1489233, Orrville, Ohio) submitted an AWC in which he was assessed a deferred fine of $30,000, suspended from association with any FINRA member in any capacity for 16 months, and ordered to pay deferred disgorgement of commissions of $189,000, plus interest. Without admitting or denying the findings, Brenner consented to the sanctions and to the entry of findings that he engaged in two separate private placements which were rife with supervisory and substantive violations.  The findings stated that in soliciting customers to purchase a private placement offering, Brenner provided customers with a private placement memorandum…