Articles Posted in Investment Fraud

Investment News reports that Richard Ketcham, FINRA’s chairman and chief executive last week warned an audience of more than 900 industry professionals at the regulator’s annual meeting in Washington that the regulator is focusing on broker-dealers that sell structured products such a reverse convertible notes. This news comes on the heels of our blog post last…

According to a Bloomberg News article today entitled, Massachusetts Investigates Sales of Reverse Convertible Notes, the state securities regulator appears to be positioning itself to potentially take action against the brokerage industry on its sales practices related reverse convertible notes. Reverse convertible notes are very complex structured investments that are rarely suitable for retail investors. To…

This month, FINRA announced that it ordered Schwab to pay $18 million to investors for improperly marketing its YieldPlus Bond fund to retail investors. The order requires Charles Schwab to pay the money into a Fair Fund that will be established by the Securities Exchange Commission (SEC) to repay investors in YieldPlus fund, an ultra short term…

On January 6, 2011, Bloomberg news published an article entitled Wall Street Turns Stock Gains Into Losses With Structured Notes. The article criticizes reverse convertible notes, a type of structured note, for their high fees and poor performance even in an up stock market. According to the article, on average reverse convertible notes lost 1 percent…

The Securities and Exchange Commission (SEC) has issued a press release stating that the SEC has charged Paul T. Mannion, Jr., of Norcross, Georgia, and Andrews S. Reckles, of Milton, Georgia, two hedge fund portfolio managers, with defrauding investors in the Palisades Master Fund, L.P. Specifically, it is alleged by the SEC that these individuals, along with…

This month, FINRA announced that it fined Merrill Lynch $500,000 and ordered the firm to pay over $2 million in restitution to its customers for failing to provide them with sales charge discounts on eligible purchases of Unit Investment Trusts (UITs). A UIT is a type of investment company that offers redeemable units that terminate on a…

AARP recently issued a warning to veterans, warning of fraudsters claiming “instant eligibility for additional benefits through a quick overhaul of [their] investments.” This growing scam can lead to serious financial harm and can often cause other difficulties for the veteran victims. The scammers claim that the purchase of investments with them will make the veterans…

According to a Securities and Exchange Commission (SEC) press release, the SEC has charged Barbra Alexander along with two other executives at APS Funding with misappropriating $2.5 million in investor funds. It is alleged that Alexander, former president of APS Funding and former host of an internationally syndicated radio show, MoneyDots, lured investors using her radio host…

Last month, FINRA, the organization that regulates the securities industry, ordered SunTrust Investment Services of Atlanta, Georgia to pay $1.44 million to resolve charges related to the unsuitable recommendations of unit investment trusts, closed-end funds and mutual fund investments sold to some of its elderly and disabled clients. Of that amount, $900,000 is a fine…

According to Investment News, the brokerage firm Securities America, Inc. and the Massachusetts Securities Division squared off over charges that the firm misled 60 investors in the state who bought $7.2 million in MedCap notes from the firm’s brokers. In total, 400 Securities America reps and advisors sold about $700 million of the private placement notes…