National investment loss lawyers KlaymanToskes reports that financial advisor John Matson (CRD# 1796541) and his firm, South Bay Acquisitions, are facing charges from the Securities and Exchange Commission (“SEC”) for allegedly orchestrating a Ponzi scheme. Matson and his firm allegedly defrauded investors by misappropriating funds, using them for personal expenses, and misleading clients about the security and management of their investments in “LLC Bonds”.
According to the SEC’s complaint, between January 2012 and September 2021, Matson raised approximately $1,535,000 from five investors through the sale of securities described as “LLC Bonds”. The LLC Bonds, which were effectively promissory notes, promised investors a return of 12% to 20% interest, with assurances that the funds would be managed as fiduciaries. However, Matson allegedly transferred around $1,566,250 to his personal account, diverting funds for personal expenses and to pay returns to earlier investors.
Investors who suffered losses with broker John Matson are encouraged to contact attorney Lawrence L. Klayman, Esq., at 888-997-9956 or by email at investigations@klaymantoskes.com to discuss recovery options. We do not collect attorney’s fees unless we are able to obtain a financial recovery for you.
Matson’s misconduct reportedly came under scrutiny when a call from an 80-year-old customer to the FINRA Securities Helpline for Seniors revealed that Matson recommended investments in promissory notes but failed to make promised interest payments. This led to an investigation by FINRA, which resulted in Matson being permanently barred from acting as a broker in December 2022, after he refused to cooperate with FINRA’s requests for documents and information.
Additionally, Matson’s actions raised red flags within his affiliated firm, LPL Financial. The firm filed a Uniform Termination Notice for Securities Industry Registration (Form U5) on December 7, 2022, disclosing Matson’s failure to cooperate fully with their internal investigation into potential fraud or misconduct. This investigation was reportedly initiated due to concerns about Matson’s sale of promissory notes to customers without proper authorization or disclosure.
According to FINRA and the SEC, investment firms such as South Bay Acquisitions and LPL Financial are responsible for the supervision of all of the activities of their registered brokers and investment advisors. Investors may be entitled to a financial recovery if their brokerage firm failed to supervise the representative managing their brokerage account, and/or if their broker/advisor made unsuitable investment recommendations.
KlaymanToskes has helped recover over $600 million (exclusive of attorneys fees and costs) for investors, and can help you determine if your loss is due to fraud, financial advisor misconduct, unsuitable investment advice, and/or other securities violations. Contact KlaymanToskes at 888-997-9956 or fill out a short contact form for a free and confidential consultation to discuss your recovery options.
KlaymanToskes is a leading national securities law firm specializing in securities arbitration and litigation on behalf of retail and institutional investors. The firm has recovered over $600 million for clients in FINRA arbitrations and other securities litigation matters. With offices in California, Florida, New York, and Puerto Rico, KlaymanToskes is committed to helping investors recover their losses and hold brokerage firms accountable for their actions.
KlaymanToskes, P.A.
Lawrence L. Klayman, Esq.
888-997-9956
investigations@klaymantoskes.com
www.klaymantoskes.com