Next Financial Group: Do You Have A Claim?

Next Financial Group is finding the year of 2009 to be an ongoing hotbed of controversy, with the independent broker/dealer mired in investor complaints and regulatory problems. In July, the Houston-based firm was fined $1 million by the Financial Industry Regulatory Authority (FINRA) for supervisory failures that led to churning of customers’ accounts and excessive commissions. In August, a former Next Financial broker, Jeremy McGilvrey, became the target of an investigation and eventual lawsuit for allegedly stealing $1.5 million from two elderly clients, one of whom suffers from severe Alzheimer’s and dementia. The complaint was amended in September to include Next Financial, which the claimant says failed to supervise McGilvrey during the time that the crimes reportedly were committed.

Next Financial also was one of a number of independent broker-dealers with advisers selling private securities of an oil and gas partnership – Provident Asset Management LLC of Dallas – that the Securities and Exchange Commission (SEC) brought charges against last month for allegedly committing a $485 million Ponzi scheme.

Allegations of supervisory failures in connection to rogue brokers are not exactly new to Next Financial. According to FINRA records, similar troubles date back several years. In 2008, a Next Financial broker who had been ousted from the securities industry cost Next Financial $165,000 to settle claims involving clients who got burned by the broker. The broker in question was Gregory Horton, who joined Next Financial in 2004.

FINRA later imposed fines on Next Financial, citing the firm’s lack of reasonable policies and written procedures resulted in its failure to detect churning of customer accounts by Horton and another Next Financial broker, Timothy Shively, as well as excessive markups and markdowns on corporate bond trades by another two brokers. As a result, customers of Next Financial, including elderly and retired individuals, lost about $768,000.

In separate actions, FINRA barred Horton and Shively from the securities industry in January 2008 and October 2008, respectively.

FINRA further found that Next Financial’s systems and procedures governing variable annuity exchanges were not reasonable and failed to provide adequate guidance about the criteria that should be used when recommending variable annuity exchanges to clients.

To learn whether you can recover losses through a claim against Next Financial Group, please fill out the Contact Us form or leave a comment below. We want to hear your story and consult with you about your options.

This entry was posted on Tuesday, October 6th, 2009 at 7:10 am and is filed under Jeremy McGilvrey, former employer: Next Financial, Next Financial, Stockbroker Misconduct, Timothy Shively, former employer: Next Financial. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.