August 2010 Archives

August 24, 2010

Montana Securities Regulators Take Disciplinary Action Against Securities America Over Medical Capital Fiasco

Thumbnail image for Montana_Seal.pngOn August 4, 2010, the Montana Securities and Insurance Commissioner filed a disciplinary action against Securities America and several of the firm's top executives alleging securities fraud in connection with the sale of the failed Medical Capital private placement. The Montana lawsuit seeks the imposition of fines and restitution on behalf of four different groups of investors identified in the lawsuit and also to provide appropriate restitution to all Montana participants. Montana's disciplinary action is similar to the lawsuit filed by the Commonwealth of Massachusetts against Securities America back in January 2010.

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August 12, 2010

Securities Regulators Vow to Make the Protection of Senior Investors a Top Priority

Thumbnail image for Senior Xing.jpgIf the type of cases that are coming into my securities law firm are any indication, then claims of account mismanagement and securities fraud involving senior citizens are on the rise. Without a doubt, the recent economic downturn wreaked havoc on many retirement portfolios. According to the Investment Company Institute (ICI), retirement assets in the United States fell by $4.5 trillion between the end of 2007 and the first quarter of 2009.

Because the estimated number of Americans who are 65 or older will more than double to 89 million individuals over the next 4 decades, regulators have made protecting seniors from investment fraud and abuse a top priority. In a report issued today by the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA) and the North American Securities Administrators Association ("NSAA"), the three agencies outlined the steps that financial services firms should take in order to improve their policies and procedures when working with senior investors. Click here to download the joint report.

The regulators are urging financial services firms to adopt these latest practices when serving senior investors. "Best practice" guidelines alone, however, are not enough to protect millions of soon-to-be-retired baby boomers. Securities regulators will need to aggressively monitor and bring enforcement cases against financial services firms that prey upon senior investors.

Related Links:

Alcala Law Firm - Elder Financial Abuse Information
SEC - Investor Information for Seniors
NASAA - Senior Investor Resource Center

August 2, 2010

California Stockbroker Discipline Report for July 2010

Thumbnail image for Thumbnail image for warning_flag.jpgThe following information regarding broker misconduct and disciplinary activities taken against California stockbrokers was released by the Financial Industry Regulatory Authority (FINRA) in July 2010:

Stephen White Wilson (Westlake Village and Thousand Oaks, California) formerly with AFA Financial Group, Brookstreet Securities, Wedbush Morgan Securities, Securities America and Wachovia Securities, among others, was barred from association with any FINRA member in any capacity for making fraudulent and material misrepresentations in the sale of mutual funds, inducing customers to switch mutual funds, and for engaging in unauthorized trading when switching customers from Class B to Class C mutual fund shares. Mr. Wilson has appealed this decision.

First Allied Securities, Inc. (formerly known as FFP Securities, Inc.) of San Diego, California, was fined $27,500 and, without admitting liability, consented to an entry of findings that the firm failed to provide customers with a confirmation and other information disclosing the total price paid or the amount of commission paid by customers in connection with the purchase of variable life settlements. The findings also noted that the firm failed to supervise the broker that handled the life settlement transactions.

Seyed Ahmad Hashemian formerly with Centaurus Financial and formerly with First Allied Securities/FFP Securities was censured and fined $10,000. Without admitting or denying the findings, Hashemian consented to findings that he failed to provide customers with a confirmation and other information disclosing the total price paid or the amount of commission paid by customers in connection with the purchase of variable life settlements.

Wedbush Securities, Inc. based in Los Angeles, California, was fined $10,000 and made restitution totaling $581.38. Without admitting liability, the firm consented to an entry of findings that it failed to fully and promptly execute orders and use reasonable diligence to ascertain the best inter-dealer market and also failed to take steps to ensure that the resultant price to its customer was as favorable as possible under prevailing market conditions.

Stephen A. Hancock formerly with Wells Fargo Investments and Wells Fargo Bank in San Francisco, California, was barred from association with any FINRA member in any capacity for misappropriating $11,320 in funds from an elderly bank customer's account.

Jeffrey Scott Mayer formerly with The Seidelman Companies Incorporated and now with Crowell, Weedon & Co. was fined $5,000 and suspended effective June 21, 2010, through July 16, 2010, for failing to supervise a broker who improperly handled customer accounts in his branch office.

Michael Alcide Poutre (Tarzana and Beverly Hills, California), formerly with Brookstone Securities, Maxxtrade, Inc. and GunnAllen Financial California was fined $5,000 and suspended from association with any FINRA member in any capacity for two years for failing to provide complete responses to FINRA requests for information and documents in a pending investigation.