Skip to main content

Menu

Representing Individual, High Net Worth & Institutional Investors

Offices in Indiana and New York City

317.598.2040
212.837.7908

Home > Blog > Category Archives: Broker/dealer

Category Archives: Broker/dealer

Regulators Bar Adviser Tom Buck From Securities Industry

On July 24th, FINRA permanently barred former Merrill Lynch broker Tom Buck from the securities industry. FINRA alleged that Buck engaged in unauthorized trading, improperly used commission based accounts when fixed fee accounts were more appropriate, and misled clients about fees they were paying in their accounts. Our firm is continuing to assist investors in their potential claims against Merrill Lynch and Tom Buck for all these matters.

Checkout the below links for more on this story:

FINRA Consent Agreement Buck

http://www.ibj.com/articles/54198-regulators-bar-adviser-tom-buck-from-securities-industry

http://www.investmentnews.com/article/20150728/FREE/150729893/fired-by-merrill-now-barred-by-finra-thomas-buck-stops-here

 

 

City Securities Broker John Miller Suspended and Fined

FINRA recently sanctioned an Indianapolis stock broker for failing to obtain written authorization from his clients before purchasing investments in their accounts.  According to his CRD, John Miller of City Securities was suspended for 20 days and fined $10,000 by the regulator.  Maddox Hargett & Caruso is investigating these allegations.  If you believe your stock broker placed unauthorized investments in your account, please contact us.

Former Ovation CFO Alfred Talens Charged with Stealing About $600,000

As a result of, Alfred Talens being charged with stealing about $600,000 from Ovation where he was the CFO, along with other charges. We are looking into cases against Talens and LPL where he was employed as a stockbroker.

For more on this developing story click these links:

http://www.indystar.com/story/news/crime/2015/06/29/companys-cfo-charged-with-stealing-more-than-half-million/29478899/

http://www.ibj.com/articles/53823-former-ovation-cfo-arrested-on-multiple-theft-charges

 

FINRA Suspends City Securities Broker John Cody Miller

Our firm will be looking into investor complaints against John Cody Miller, a City Securities broker and investment adviser in Indiana, as a result of his suspension for executing trades without written consent, going against his company’s policies. For more on this broker and his suspension checkout the below link.

http://www.ibj.com/articles/53717-federal-authorities-suspend-city-securities-broker

Tom Buck Now Facing 5 Customer Complaints for Unauthorized Trading & Excessive Fees

Our firm will be looking into investor complaints against Tom Buck and the Buck Group as a result of his termination from Merrill Lynch. Checkout the latest on Tom Buck below.

http://www.ibj.com/articles/53525-high-profile-broker-buck-faces-rash-of-complaints?utm_source=eight-at-8&utm_medium=newsletter&utm_campaign=2015-06-09

 

Colorado Merrill Lynch Brokers Terminated by Bank of America

Our firm will be looking into investor complaints against Joseph Yanofsky and Brooke Clements and the Yanofsky Group as a result of their termination from Bank of America Merrill Lynch.

http://www.reuters.com/article/2015/05/05/moves-bank-of-america-merrill-lynch-yano-idUSL1N0XV0Y020150505

 

Veros Partners sued by SEC for Alleged Ponzi Scheme

Indianapolis Securities Firm, Veros Partners, has been sued by the SEC for an assumed Ponzi scheme that raised $15M in two farm-loan offerings. The lawsuit states that, Veros owes millions of dollars to over 80 investors in past payments. Named in the suit are Veros President Matthew Haab, Fishers attorney Jeffery Risinger, and CEO of Pin Financial Tobin Senefeld. All the assets of those named in the suit have been frozen. This is not Senefeld’s first time being pursued by the SEC. In 1999, he paid a $25,000 fine and 12 month suspension with working with broker dealers, as a result of securities violations.

 

Tom Buck Update

Our firm will be looking into investor complaints against Tom Buck and the Buck Group as a result of his termination from Merrill Lynch. Checkout the latest on Tom Buck below.

http://www.ibj.com/articles/52616-merrill-lynch-firing-of-top-adviser-was-for-compliance-lapses

http://www.indystar.com/story/money/2015/04/06/merrill-lynch-says-fired-heavy-hitter-carmel-broker-tom-buck/25366547/

WHAT HAPPENS WHEN YOUR BROKERS AGE CATCHES UP WITH THEM?

Just like an average person who ages, an older financial adviser is more likely to show signs of aging. Red flags that a financial adviser might be suffering from senior moments: forgetfulness, a tendency to repeat things, a disregard for following instructions. If you are concerned, bring attention to the branch manager or to compliance, or, if they don’t do anything, to the authority. An increasing problem that seems to go unreported most of the time, but in the next few decades be prepared to see these declining mental skills claims increase.

51 is the average age of financial advisers and 43 percent are older than 55, according to Cerulli Associates. Many are planning to retire in the next decade and it is a struggle to recruit young advisers to offset those retiring from the industry. The North American Securities Administrators Association are aware of the financial services industry’s continuing concerns regarding the aging of advisers and have begun addressing the issue with proposing a rule requiring state-registered investment advisers to have succession and business continuity plans in place.

Emerging Investor Threats for 2015

New products in classic schemes such as, binary options, marijuana-related businesses, stream-of-income investments, and digital currency sure to face investors this coming year.

William Beatty, NASAA President and Washington Securities Director says “Regulators are seeing classic threats to investors morph into new or altered dangers, many fueled by the Internet. Overarching all of these threats are unlicensed agents selling unregistered products to unsuspecting investors.”

The following list of top threats facing unwary investors throughout North America was compiled by the securities regulators in NASAA’s Enforcement Section:

Emerging Threats:

  • Binary Options
  • Marijuana Industry Investments
  • Stream-of-Income Investments
  • Digital Currency & Cybersecurity Risks

Persistent Threats:

  • Reg D/Rule 506 Private Offerings
  • Pyramid and Other Ponzi Schemes
  • Real Estate Schemes, Including Those Using Promissory Notes Affinity Fraud
  • Internet Fraud (including Social Media and Crowdfunding)
  • Oil & Gas Investments in the Fracking Era

State and provincial securities regulators can provide detailed background information about those who are registered to sell securities or provide investment advice, and about the products being offered. Unregistered individuals continue to be the most common subject of enforcement actions by state securities regulators. “It pays to investigate before you invest,” Beatty says.

Top Emerging Investor Threats Closer Look, Courtesy of the Securities Regulator NASAA.

Binary Options: Binary options are securities in the form of options contracts that have a payout that depends on whether the underlying asset – for example, a company’s stock or a stock index – increases or decreases in value. In such an all-or nothing payout structure, investors betting on a stock price increase face two possible outcomes when the contract expires: they either receive a pre-determined amount of money if the value of the asset increased over the fixed period, or no money at all if it decreased. Unlike a traditional option, a binary option will pay a fixed sum at expiration regardless of the magnitude of the difference between the settlement value and the option’s exercise price. A call binary index option would pay out if the settlement value of the underlying index were at or above the option’s exercise price at expiration, and a put binary index option would pay out if the underlying index were below the option’s exercise price at expiration. Binary option risks include: illegal distributions- trading of binary options without complying with applicable registration and distribution requirements; potential for fraud – fraudulent promotion schemes (with misleading average returns on investment); identity theft (collecting customer information such as credit card and driver’s license data for unspecified uses); refusals to return, or pay out, investor funds; potential for abusive trading: manipulation of the binary options trading software to generate losing trades. Particular investor risks are that the option is an all-or-nothing payout structure and investors can easily lose their entire investment. In addition, much of the binary options market operates through Internet-based trading platforms that are not necessarily complying with applicable local regulatory requirements.

Marijuana Industry Investments: Medical marijuana is legal in 23 states and the District of Columbia, and recreational use is legal in four states and the District of Columbia. The legalization of this once prohibited substance is generating headlines, which, in turn, has grabbed the attention of investors looking to capitalize on the high potential of this new legal market. Many promoters have seized upon this to market and sell investments in the marijuana industry, including investments in companies that provide products and services to the marijuana industry such as vaporizers, hydroponic supplies, lighting systems, and security systems. But as is the case with any headline-generating topic, scam artists also recognize an opportunity to capitalize. Many of these companies are micro-cap companies selling low-priced securities which typically are highly speculative and carry a high degree of risk for investors. Securities regulators are seeing “pump and dump” scams, typical of micro-cap offerings. Fraudsters lure investors with aggressive, optimistic, and potentially false or misleading information designed to create unwarranted demand for shares of a small, thinly traded company with little or no history of financial success (the “pump”). Once share prices and volumes peak, scammers behind the ploy sell their shares at a profit, leaving investors with worthless stock (the “dump”). Investors should think carefully and do their due diligence before jumping into marijuana-related investments.

Stream-of-Income Investments: Investors looking for monthly returns are being enticed to invest by companies that introduce investors to individuals selling a stream of income, such as pension payments or government disability payments. These investments can carry significant risks as laws may prohibit the assignment of the stream of income/benefits, the seller typically maintains the legal right to redirect the payment, and if the seller does redirect the payment, the investor may be left with an unenforceable contract right. In addition, the benefits are contingent on the life of the seller, and even life insurance policies on the seller’s life may be cancelled and do not protect an investor if a seller simply redirects the income stream. Sales of these investments are of concern to state regulators because often veterans and disabled persons are preyed upon to assign their benefits when they experience financially stressful times, selling much needed future benefit payments at a significant reduction. Investors should consider obtaining independent legal advice before investing in the purchase of another person’s income stream and also check with their local securities regulator to confirm that the investment and those selling it are exempt from registration or are properly registered.

Digital Currency & Cybersecurity Risks: Digital currencies are emerging as trendy way to pay for goods and services. Bitcoin, perhaps the most popular digital currency, was priced at around $10 per unit in early 2013 but peaked at around $1,200 per unit later that year. The rapid price increase sparked considerable public interest and media attention, creating a fresh market for securities offerings tied to digital currencies. Unfortunately, unscrupulous promoters may be attempting to capitalize on this popularity by illegally offering securities tied to digital currencies. Even legitimate securities offerings tied to digital currencies may present considerable risks to the investing public, including risks associated with volatility and demand for the units, the anonymity associated with the use of certain digital currencies, and the threats posed by hackers using malicious software to compromise network security systems. These risks were highlighted earlier this year when Mt. Gox, once the world’s largest Bitcoin exchange, filed for bankruptcy amid reports that hackers may have stolen around 850,000 Bitcoins worth as much as $500 million.

 


Top of Page