Investors Overcharged for Mutual Funds by MassMutual, H.D. Vest & Principal Securities, FINRA Alleges

Posted on Feb 10th, 2017

If you bought mutual funds from H.D. Vest or MassMutual’s brokerage arm, MML Investor Services, you may have been overcharged. The Financial Industry Regulatory Authority (FINRA) has been cracking down on investment firms that do not apply mutual fund sales charge waivers investors are entitled to receive, and MassMutual and H.D. Vest are just the latest firms to be caught overcharging investors. This can add up to thousands of dollars per investor, and millions in ill-gotten profits for brokerages.

First Southern Securities Busted for Bad Municipal Bond Sales

Posted on Feb 10th, 2017

Clients of First Southern Securities of Alpharetta, Georgia may have paid too much for their municipal bonds, or get paid too little if they ever sell them.

According to settlement documents between First Southern Securities and the Financial Industry Regulatory Authority (FINRA), First Southern Securities made three important mistakes in over fifty different municipal bond transactions:

1)      They sold municipal bonds in amounts that were below the minimum denomination;

2)      They did not disclose to investors that the sales were below the minimum denomination; and

3)      They had inadequate supervision in place to catch such sales.

Dougherty & Company Censured for Unauthorized, Unsuitable Trades in Elderly Investors’ Accounts

Posted on Feb 9th, 2017

The Financial Industry Regulatory Authority (FINRA) censured and fined Dougherty & Company after one of its “top producers” allegedly ripped off elderly investors by executing hundreds of unsuitable, unauthorized trades in their accounts over a four-year period.

These allegations come from a settlement document Dougherty & Company signed, which expressly precludes Dougherty & Company from contesting these allegations.

According to FINRA, this advisor recommended “short-term trading in corporate and municipal bonds and unnecessary uses of margin”—on the occasions that he spoke with his elderly clients before entering trades in their account.

Vanclef Financial Group in Hot Water for Misleading Marketing of Alternative Investments like Non-Traded REITs.

Posted on Feb 8th, 2017

Clients of Vanclef Financial Group might be finding out the hard way that you can lose a lot of money in alternative investments.

The Financial Industry Regulatory Authority (FINRA) recently announced that it had settled a disciplinary proceeding brought against a subsidiary of Vanclef Financial Group, VFG Securities, as well as Jason B. Vanclef for allegedly misleading marketing of alternative investments.

FINRA’s complaint paints an unflattering picture of Vanclef Financial Group, which VFG Securities cannot dispute under the settlement agreement.

IFS Securities Financial Advisor Richard Cody Secretly Empties Investors’ Retirement Accounts, SEC Alleges

Posted on Jan 16th, 2017

Imagine that you have woken up every day for eight years enjoying your secure retirement. Then, one day, you learn that the retirement portfolio you thought you owned, the foundation for your financial security, has vanished. This is exactly what happened to some unlucky Verizon retirees who trusted Richard Cody and his wife with their retirement portfolios, according to the U.S. Securities & Exchange Commission.

Cambridge Investment Research Customers Who Bought Mutual Funds Charged “Unnecessary” Fees, FINRA Concludes

Posted on Nov 18th, 2016

Mr. Robert (“Bob”) M. Lyons of August, Georgia recently entered into a settlement agreement with the Financial Industry Regulatory Authority for conduct that led to customers paying unnecessary fees while Mr. Lyons worked for Cambridge Investment Research.

The alleged misconduct revolves around the improper sale of mutual funds. When an investor invests in a mutual fund, he or she usually has a variety of mutual fund share classes to choose from: class A shares; class B shares; class C shares; and even class T shares.

LPL Supervisor Michael S. Lincoln’s Head in Ground while San Diego Financial Advisor Solicited Investments in Speculative Hawaii Real Estate from LPL Customers

Posted on Nov 18th, 2016

Mr. Michael Lincoln is probably regretting his decision to avoid reporting the outside business activity (OBA) of a financial advisor he was supposed to be supervising, according to settlement documents he signed with the Financial Industry Regulatory Authority (FINRA).

While at LPL Financial, Mr. Lincoln supervised a financial advisor who developed a real estate property in Hawaii. Mr. Lincoln even invested $850,000 of his own money in his subordinate’s business venture.

Merrill Lynch Financial Advisor Matthew J. Gorelik Lied About Having a College Degree?

Posted on Nov 18th, 2016

According to settlement papers signed with the Financial Industry Regulatory Authority (FINRA), Mr. Gorelik, a financial advisor with a long career, has been misrepresenting his educational background.

Mr. Matthew J. Gorelik told his brokerage firm, Merrill Lynch, and others that he graduated from a university in Massachusetts. While the settlement papers do not state which university, we all know that the most prestigious university in Massachusetts is Harvard.

The truth is that Mr. Gorelik has never graduated from any university, much less Harvard.

Sigma Financial Busted for Overcharging Customers on Unit Investment Trusts (UITs)

Posted on Nov 13th, 2016

Sigma Financial joined a long line of brokerage firms that have gotten in trouble for overcharging customers recently, settling allegations brought by the Financial Industry Regulatory Authority (FINRA) for approximately $200,000 in fines and restitution.

According to Sigma’s settlement agreement with FINRA, Sigma failed to apply sales charge discounts to customers who purchased Unit Investment Trusts (UITs). There are a variety of investments, like UITs, which offer volume discounts to investors. Failure to pass these discounts on to investors is an increasingly common problem in the brokerage industry.

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