Financial Counsel by Eccleston Law

FINRA Sanctions Eight Firms and 10 Individuals Over Private Placement Losses

FINRA recently announced that it sanctioned eight firms and ten individuals, and ordered $3.2 million in restitution to investors for selling interests in private placement securities offering without conducting a “reasonable basis” suitability analysis for such recommendations.  The firms and individuals involved sold, among other products, interests in DBSI, Provident Royalties, and Medical Capital Holdings, all of which collapsed causing almost a complete loss for investors.

According to the FINRA press release, the following firms and individuals sanctioned by the regulator include:

• NEXT Financial Group, Inc. of Houston, TX, was ordered to pay $2 million in restitution to affected customers and fined $50,000; Steven Lynn Nelson, the firm's Vice President for Investment Products and Services, was suspended in any principal capacity for six months and fined $10,000 in connection with the sale of three Provident Royalties private placements.
• Investors Capital Corporation of Lynnfield, MA, was ordered to pay roughly $400,000 in restitution to affected customers in connection with the sale of two Provident Royalties private placements and was also sanctioned in connection with an additional offering issued by CIP Leveraged Fund Advisors.
• Garden State Securities, Inc. of Red Bank, NJ, and Kevin John DeRosa, a co-owner of the firm, were ordered to pay $300,000 in restitution on a joint-and-several basis to affected customers in connection with the sale of a Medical Capital private placement. DeRosa was also suspended for 20 business days in any capacity and for an additional two months in any principal capacity, and fined $25,000. Vincent Michael Bruno, the firm's Chief Compliance Officer at the time, was suspended for one month in a principal capacity and fined $10,000.
• Capital Financial Services of Minot, ND, was ordered to pay $200,000 in restitution to affected customers, and Brian W. Boppre, a former principal, was suspended in any principal capacity for six months and fined $10,000 in connection with the sale of three Provident Royalties private placements and a Medical Capital private placement.
• National Securities Corporation of Seattle, WA, was ordered to pay $175,000 in restitution to affected customers, and Matthew G. Portes, Director of Alternative Investments/Director of Syndications, was suspended in any principal capacity for six months and fined $10,000 in connection with the sale of three Provident Royalties private placements and a Medical Capital private placement.
• Equity Services, Inc. of Montpelier, VT, was censured, fined $50,000 and ordered to pay nearly $164,000 in restitution in connection with the sale of a private placement DBSI, Inc. issued; Stephen Anthony Englese, Senior Vice President for Securities Operations, was suspended from association with any FINRA-regulated firm in any capacity for 30 business days and fined $10,000; and Anthony Paul Campagna, a registered representative, was suspended from association with any FINRA-regulated firm in any capacity for 30 business days and fined $25,000.
• Securities America, Inc. of La Vista, NE, was censured and fined $250,000 in connection with the sale of two Provident Royalties private placements.
• Newbridge Securities Corporation of Fort Lauderdale, FL, was fined $25,000; Robin Fran Bush, the former Chief Compliance Officer of Newbridge, was suspended in any principal capacity for six months and fined $15,000 in connection with the sale of four DBSI private placements and a Medical Capital private placement.
• Leroy H. Paris II, former President and Chief Executive Officer for the now-defunct Meadowbrook Securities, LLC (fka Investlinc Securities, LLC), of Jackson, MS, was suspended for six months in any principal capacity and fined $10,000 in connection with the sale of two Provident Royalties private placements and a Medical Capital private placement.
• Michael D. Shaw, formerly associated with VSR Financial Services, Inc. of Baton Rouge, LA, was barred from the industry in connection with the sale of a private placement offered by DBSI, Inc. and several additional private placements offered by other issuers. In addition, Shaw falsified customer account documents.

Eccleston Law represents individual and institutional investors nationwide to recover their investment losses caused by securities fraud, unsuitable investment recommendations, breach of fiduciary duty, negligence or other misconduct. We have extensive experience representing investors in arbitration and litigation disputes with securities broker-dealers and investment advisory firms, and have recovered tens of millions of dollars for investors.

If you are an investor that has suffered losses investing in DBSI, Medical Capital Holdings, or Provident Shale Royalties , please contact one of our attorneys at 312-332-0000 to discuss your recovery options.

 

Solaris Opportunity Fund Loss Recovery Options

The attorneys at Eccleston Law have launched an investigation of the Solaris Opportunity Fund, its investmetn advsior Solaris Management, LLC, and Patrick G. Rooney for the alleged misuse of the Solaris Fund's assets and other illegal conduct alleged in an SEC civil injunction action.

On November 22, 2011, the SEC filed a complaint alleging that the Solaris Fund, which is purported to be a non-diretional hedge fund with approximately 30 investors, made a radical change in direction in the fund's investment strategy by becoming wholly invested in Positron Corporation, a troubled microcap company which Patrick Rooney has been Chairman of since 2004.  According to the SEC, Patrick Rooney allegedly misued the Solaris Fund investor moeny by investing over $3.6 million in Positron.  The SEC further alleged that the investmetns benefited Positron and Patrick Rooney, while providing the Solaris Fund with a concentrated, undiversified, and illiquid position in a cash-poor company with a lengthy track record of losses.  

Eccleston Law represents individual and institutional investors nationwide to recover their investment losses caused by securities fraud, unsuitable investment recommendations, breach of fiduciary duty, negligence or other misconduct. We have extensive experience representing investors in arbitration and litigation disputes with securities broker-dealers and investment advisory firms, and have recovered tens of millions of dollars for investors.

If you are an investor that has suffered losses investing with Solaris Opportunity Fund, Solaris Management, or Patrick G. Rooney, please contact one of our attorneys at 312-332-0000 to discuss your recovery options.

 

Praetorian Global Fund Loss Recovery Attorneys

The attorneys at Eccleston Law are actively seeking to represent investors who have suffered losses in the pre-IPO fraud allegedly involving the Praetorian Global Fund and Florida resident John A. Mattera. 

The SEC recently filed a lawsuit alleging that various individuals and entities carried out the scam using a newly-minted hedge fund named The Praetorian Global Fund. They are believed to have falsely claimed that the fund and affiliated Praetorian entities owned shares worth tens of millions of dollars in privately-held companies that were expected to soon hold an initial public offering (IPO) including Facebook, Groupon, and others.Taking advantage of investor interest in pre-IPO shares that are virtually impossible for company outsiders to obtain, John A. Mattera and others allegedly solicited funds and gave investors a false sense of comfort that their money was protected by telling them that an escrow service was receiving their funds.

In reality, according to the SEC’s complaint, John A. Mattera and his cohorts never owned the promised pre-IPO shares in these companies. The SEC sought an emergency court order to freeze the assets of John A. Mattera, John R. Arnold, Joseph Almazon of Hicksville, N.Y., David E. Howard II of New York City, Bradford Van Siclen of Montclair, N.J., and eight different entities. The SEC’s complaints charge Mattera, Van Siclen, the Praetorian Fund, Praetorian G Power I LLC, Praetorian G Power II LLC, Praetorian G IV, Praetorian G Power V LLC, and Praetorian G Power VI LLC, Arnold, Spartan Capital Partners and First American Service Transmittals Inc. with various violations of Federal securities laws.

Eccleston Law represents individual and institutional investors nationwide to recover their investment losses caused by securities fraud, unsuitable investment recommendations, breach of fiduciary duty, negligence or other misconduct. We have extensive experience representing investors in arbitration and litigation disputes with securities broker-dealers and investment advisory firms, and have recovered tens of millions of dollars for investors.

If you are an investor that has suffered losses investing with John A. Mattera, The Praetorian Global Fund, John R. Arnold, Joseph Almazon, David E. Howard II,  Bradford Van Siclen, the Praetorian Fund, Praetorian G Power I LLC, Praetorian G Power II LLC, Praetorian G IV, Praetorian G Power V LLC, and Praetorian G Power VI LLC, Spartan Capital Partners or First American Service Transmittals, please contact one of our attorneys at 312-332-0000 to discuss your recovery options.

Solomon Keegan Group/WTS Proprietary Trading Group Loss Recovery Attorneys

The attorneys at Eccleston law have launched an investigation of the Los Angeles-based Solomon Keegan Group and WTS Proprietary Trading Group following reports of investor trading losses.

According to its website, the Solomon Keegan Group "operates a premier equity trading firm consulting clients on profitable methods to trade their personal investment capital. The firm offers opportunities for select clients to trade capital in addition to their own capital to generate greater returns.  Our proven system and methodology was developed over more than10 years by licensed  professional traders."

 

The WTS Proprietary Trading Group's website states that "traders trade the firm's capital on several stock markets. We train new recruits our proprietary intraday trading methodology, with no financial risk. Our leading edge, direct access electronic trading platform provides traders with live market data, volume price discounts, rapid order execution, and software stability, giving our traders the necessary advantages to succeed."

 

Upon information and belief, both traders and investors may have suffered losses investing and/or trading with either the Solomon Keegan Group and/or the WTS Proprietary Trading Group.  If you are a trader or investor who has suffered such losses, your losses may be recoverable through securities arbitration or litigation.

Eccleston Law represents individual and institutional investors nationwide to recover their investment losses caused by securities fraud, unsuitable investment recommendations, breach of fiduciary duty, negligence or other misconduct. We have extensive experience representing investors in arbitration and litigation disputes with securities broker-dealers and investment advisory firms, and have recovered tens of millions of dollars for investors.

If you are an investor that has suffered losses investing with Solomon Keegan Group or WTS Proprietary Trading Group, please contact one of our attorneys at 312-332-0000 to discuss your recovery options.

 

FACAAP Recovery Options for Former Merrill Lynch Brokers

Eccleston Law is pleased to announce that its attorneys are continuing investigation to offer representation to former Merrill Lynch (Bank of America) financial advisors with unpaid Financial Advisor Capital Accumulation ("FACAAP"), Wealthbuilder, Growth Award, and Long Term Incentive Compensation ("LTICP") deferred compensation.

Prior to 2009, the FACAAP provided for awards to eligible employees in Merrill Lynch’s Global Wealth Management division generally based upon their prior year’s performance. Payment for an award was contingent upon continued employment for a period of time and subject to forfeiture during that period. Awards granted in 2003 and thereafter are generally payable eight years from the date of grant in a fixed number of shares of Bank of America common stock. For outstanding awards granted prior to 2003, payment is generally made ten years from the date of grant in a fixed number of shares of Bank of America common stock unless the fair market value of such shares is less than a specified minimum value, in which case the minimum value is paid in cash. FACAAP is no longer an active plan and no awards were granted in 2009. At December 31, 2009, there were 26 million shares awarded under FACAAP outstanding, of which 6 million shares were granted prior to 2003. The weighted-average fair value of awards granted under FACAAP during 2008 and 2007 was $45.04 and $83.30 per award, respectively.

When Bank of America acquired Merrill Lynch in September 2008, it negotiated certain deal terms affecting deferred compensation for the financial advisors.  Namely, as part of the acquisition documents, a "change in control" clause was triggered that affected the way certain deferred compensation plans vested.  The affected plans include the FACAAP, Wealthbuilder, Growth Award, and Long Term Incentive Compensation ("LTICP") plans.  As structured, if a broker with the firm leaves for "good reason" as defined by the plan documents, Merrill Lynch is required to pay must immediately vest and pay the departing awards.

If you are a broker who left Merrill Lynch after August of 2008 to join another brokerage, you may be able to recover your unpaid FACAAP, Growth Award, Wealthbuilder, or Long Term Incentive Compensation ("LTICP") deferred compensation.

Eccleston Law represents financial advisers nationwide in regulatory, compliance, disciplinary and employment matters in arbitration, litigation, and before regulatory bodies such as the SEC, FINRA and state securities regulators.  If you are a former Merrill Lynch broker with an unpaid FACAAP, Growth Award, Wealthbuilder, or Long Term Incentive Compensation ("LTICP") deferred compensation, contact one of our attorneys at 312-332-0000 to discuss your case.

David Lerner Associates Advisers Leaving Firm; Latest In the News

The latest rep to depart is Zoran Vaz.  Mr. Vaz has left Lerner for Wells Fargo Advisors in its Melville, New York branch location.  While at Lerner, he managed $111 million for clients.

Advisers who leave Lerner still may have issues with the liquidity of Apple REITs.  Eccleston Law not only assists advisers in their transitions but also assists investors who unfortunately may hold illiquid securities through remedies that they request in securities arbitration.

Eccleston Law Announces FACAAP Representation for Former Merrill Lynch Brokers

Eccleston Law is pleased to announce that its attorneys have expanded their investigation of unpaid Financial Advisor Capital Accumulation ("FACAAP") awards and continues to offer representation to former Merrill Lynch (Bank of America) financial advisors with unpaid FACAAP, Wealthbuilder, Growth Award, and Long Term Incentive Compensation ("LTICP") deferred compensation.

Prior to 2009, the FACAAP provided for awards to eligible employees in Merrill Lynch’s Global Wealth Management division generally based upon their prior year’s performance. Payment for an award was contingent upon continued employment for a period of time and subject to forfeiture during that period. Awards granted in 2003 and thereafter are generally payable eight years from the date of grant in a fixed number of shares of Bank of America common stock. For outstanding awards granted prior to 2003, payment is generally made ten years from the date of grant in a fixed number of shares of Bank of America common stock unless the fair market value of such shares is less than a specified minimum value, in which case the minimum value is paid in cash. FACAAP is no longer an active plan and no awards were granted in 2009. At December 31, 2009, there were 26 million shares awarded under FACAAP outstanding, of which 6 million shares were granted prior to 2003. The weighted-average fair value of awards granted under FACAAP during 2008 and 2007 was $45.04 and $83.30 per award, respectively.

When Bank of America acquired Merrill Lynch in September 2008, it negotiated certain deal terms affecting deferred compensation for the financial advisors.  Namely, as part of the acquisition documents, a "change in control" clause was triggered that affected the way certain deferred compensation plans vested.  The affected plans include the FACAAP, Wealthbuilder, Growth Award, and Long Term Incentive Compensation ("LTICP") plans.  As structured, if a broker with the firm leaves for "good reason" as defined by the plan documents, Merrill Lynch is required to pay must immediately vest and pay the departing awards.

If you are a broker who left Merrill Lynch after August of 2008 to join another brokerage, you may be able to recover your unpaid FACAAP, Growth Award, Wealthbuilder, or Long Term Incentive Compensation ("LTICP") deferred compensation.

Eccleston Law represents financial advisers nationwide in regulatory, compliance, disciplinary and employment matters in arbitration, litigation, and before regulatory bodies such as the SEC, FINRA and state securities regulators.  If you are a former Merrill Lynch broker with an unpaid FACAAP, Growth Award, Wealthbuilder, or Long Term Incentive Compensation ("LTICP") deferred compensation, contact one of our attorneys at 312-332-0000 to discuss your case. 

Eccleston Law Launches Investigation of the Firing Practices of Northern Trust Securities, Including Possible Instances of Form U-5 Defamation

All securities firms are required to file Form U-5 termination notices based with accurate and complete information.  Failure to do so can result in liability and damages.  Reasons for termination and language used in Disclosure Reporting Pages (DRPs) can be defamatory.

Eccleston Law welcomes inquiries from former Northern Trust Securities financial advisers as to whether the language placed on their Forms U-5 was accurate and complete.

Eccleston Law Seeks Information From Employees of MF Global

As part of its investigation, Eccleston Law wishes to speak to current or former employees of now-defunct MF Global.  Any employees who worked in sales, trading, investment banking, research, European sovereign debt investment management or brokerage may have information to assist Eccleston Law in its investigation.  Eccleston Law is a national law firm representing both investors and advisers in securities and financial services employment matters.

MF Global Investor Loss Recovery Options

The attorneys at Eccleston Law have expanded their investigation of MF Global following allegations that there may be as much as $700 million in customer funds missing from MF Global accounts.  This revelation was uncovered after a deal with Interactive Brokers collapsed.  Interactive Brokers later disclosed to the SEC and the CFTC that the funds were missing.  Investors or traders may be able to recover their losses through securities arbitration or litigation.

Leading up to MF Global's collapse and Chapter 11 bankruptcy filing, MF Global was searching for an acquiring firm following multiple downgrades by various credit rating agencies.  These downgrades caused the share price to plummet more than 80%, which caused the NYSE to suspend trading and move to delist the company.  MF Global Holdings, Ltd. and its finance subsidiary, MF Global FInance USA, Inc., also filed for Chapter 11 Bankruptcy. The FBI is also expected to investigate whether MF Global's activities were violated criminal laws.

According to its website, "MF Global is a leading broker-dealer with a deep involvement in financial markets around the world. We work closely with clients to create customized trading and hedging solutions in the world’s markets for commodities, listed futures and options, equities, fixed income securities and foreign exchange.MF Global is a member of more than 70 financial exchanges around the world, and we are a leader by trading volume on a number of these exchanges."

Eccleston Law represents individual and institutional investors nationwide to recover their investment losses caused by securities fraud, unsuitable investment recommendations, breach of fiduciary duty, negligence or other misconduct. We have extensive experience representing investors in arbitration and litigation disputes with securities broker-dealers and investment advisory firms, and have recovered tens of millions of dollars for investors.

If you are an investor that has suffered losses investing with MF Global, please contact one of our attorneys at 312-332-0000 to discuss your recovery options.

Eccleston Law Investigates MF Global In Light of Regulatory Actions, Prepares to Prosecute Claims and Assist Investors In SIPC Liquidation Proceeding

Regulators Issued a joint statement on November 1^st which reported that MF Global had “reported possible deficiencies in customer futures segregated accounts held at the firm.”  The SIPC has filed an application with the court to commence liquidation of the firm.

 In view of the above, Eccleston Law stands ready to assist investors unfortunate to have had an account with MF Global by prosecuting actions against those who have violated state or federal securities laws and regulations.

 In addition, Eccleston  Law stands ready to assist investors file claims with the SIPC and/or defend against SIPC actions filed against them.

 James J. Eccleston

President

Eccleston Law Stands Ready to Assist Reps Transition From MF Global and Defend Against Regulatory and SIPC Actions and Inquiries

The sudden demise of MF Global raises a host of issues for advisers. As of November 1st, regulators plan to transfer customer accounts to another firm, and the SIPC has initiated the liquidation of the firm. Customer accounts are frozen. Press reports indicate that there are as much as $900 million in deficiencies in customer futures segregated accounts, about which regulators were not satisfied with the company’s lack of adequate documentation.