investor education

FINRA Arbitration Award: Westpark Capital, Inc. Ordered to Pay Customers Nearly $800,000 for Actions of Former Broker, Lawrence Fawcett, Including Churning and Recommending Risky Private Placements

Published on: May 27, 2021 | by Iorio Altamirano

A FINRA Dispute Resolution Services arbitration panel in Richmond, Virginia, found Westpark Capital, Inc. to be liable for actions of its disgraced former broker, Lawrence Fawcett, and ordered the firm to pay nearly $800,000 to customers Charles and Karen Hailey. The award included over $545,000 in compensatory damages, $33,500 in costs, and $215,000 in attorneys’ fees. The arbitration panel found Westpark liable for failing to supervise Mr. Fawcett, who churned the Hailey’s accounts and made unsuitable investment recommendations. The unsuitable investment recommendations related to private placement investments in the following entities: Protagenic Therapeutics, Inc., Monster Digital, Inc., Miamar Labs, Inc.

The former stockbroker, Lawrence (Larry) Fawcett, was barred from the securities industry by FINRA in March 2018 for failing to cooperate with a FINRA investigation into his outside business activities. FINRA subsequently revoked Mr. Fawcett’s securities license for failing to pay a fine and suspended him for failing to comply with an arbitration award. Mr. Fawcett, who had only been in the securities industry for five years, had an extensive history of customer complaints, regulatory sanctions, associations with disreputable brokerage firms, and an employment termination after allegations of wrongdoing.

If you have lost money with Lawrence Fawcett or Westpark Capital, Inc., contact FINRA arbitration lawyers Iorio Altamirano LLP for a free and confidential evaluation of your account.

Triad Advisors LLC Broker, Mark Just, Suspended by FINRA – Indianapolis, Indiana

Published on: May 25, 2021 | by Iorio Altamirano

The Financial Industry Regulatory Authority (“FINRA”) has suspended Triad Advisors LLC broker Mark Just from the securities industry for three months for willfully failing to timely amend his Uniform Application for Securities Industry Registration or Transfer (Form U4) to disclose two state tax liens, which totaled $37,333.80. Mr. Just was also fined $5,000.

Mr. Just is also the subject of numerous customer complaints concerning allegedly unsuitable investment recommendations that he has made to customers involving alternative investments. According to his public disclosure report, those alternative investments include real estate securities (possibly REITs), business development companies (BDCs), direct participation programs (DPPs), Limited Partnerships (LPs).

If you have lost money with Mark William Just or Triad Advisors LLC, contact FINRA arbitration lawyers Iorio Altamirano LLP for a free and confidential evaluation of your account.

Calton & Associates, Inc. Sanctioned by FINRA Over Non-Traditional and Volatility-Linked Exchange Traded Products

Published on: May 20, 2021 | by Iorio Altamirano

Iorio Altamirano LLP is investigating claims on behalf of customers of Calton & Associates, Inc. after the firm was censured, fined $250,000, and ordered to pay $472,007 in restitution to harmed investors by FINRA.

The sanctions involve supervisory failures between February 2014 and February 2020 related to suitability obligations connected with the sale of non-traditional and volatility-linked exchange-traded products (ETPs). Non-traditional and volatility-linked ETPs are complex products intended to be held for short periods of time as part of a trading strategy rather than as buy-and-hold investments. Although the firm was aware of the complex nature of the products, Calton permitted its representatives to offer the products to retail customers without a reasonable supervisory system to properly understand the products’ features and risks and review and monitor transactions. Consequently, Calton representatives recommended non-traditional and volatility-linked ETPs to retail customers without understanding the products were intended for short-term trading rather than as buy-and-hold investments, and the firm’s customers held the products for longer periods of time, resulting in losses.

In addition, during the period from January 1, 2014, to June 21, 2018, Calton failed to offer retail customers educational materials prior to their first purchases of collateralized mortgage obligations (CMOs), and it failed to establish, maintain, and enforce a supervisory system, including written supervisory procedures (WSPs), reasonably designed to achieve compliance with FINRA rules.

Broker Spotlight: Martin Lerner of David Lerner Associates, Inc. Facing Pending Securities Arbitration Complaint Related to Energy 12 and SOAEX – Boca Raton, Florida

Published on: May 19, 2021 | by Iorio Altamirano

Martin Lerner is a stockbroker with David Lerner Associates, Inc. (“David Lerner Associates”) in Boca Raton, Florida, with a history of customer complaints.

Martin Lerner has been the subject of six customer complaints, which include one pending dispute and five resolved disputes that ended with monetary compensation being paid to a customer. The pending dispute is a securities arbitration claim filed by a customer against Martin Lerner and David Lerner Associates concerning energy-sector securities. The customer alleged that the recommendations to invest in Energy 12 L.P., an illiquid, non-traded limited partners, and Spirit of America Energy Fund (SOAEX), an energy mutual fund, were unsuitable. The customer also alleged that Martin Lerner made material misrepresentations or omissions regarding both energy-sector securities.

If you have invested in Energy 11, Energy 12, SOAEX, or lost money with broker Martin Lerner or David Lerner Associates, contact New York securities arbitration lawyers Iorio Altamirano LLP for a free and confidential evaluation of your account.

Brokers International Financial Services, LLC and Broker Mark Perry Ordered to Pay $795,959 to Widow by a FINRA Arbitration Panel

Published on: May 19, 2021 | by Iorio Altamirano

On May 17, 2021, a FINRA arbitration panel issued an award in favor of customer Donna Wagner in a securities arbitration against Brokers International Financial Services, LLC and former broker Mark Christopher Perry. Brokers International Financial Services and Mr. Perry (the “Respondents”) were held jointly and severally liable for $795,929 in compensatory damages. The Respondents were also ordered to pay post-judgment interest at a rate of 8%, beginning 30 days after the issuance of the Award.

Ms. Wagner filed a securities arbitration claim in December 2019, seeking approximately $1.34 million in actual damages. The Statement of Claim alleged that Mr. Perry, while registered with Brokers International Financial Services, was also the President of Brendanwood Financial Brokerage, an insurance brokerage firm in Carmel, Indiana. The claim alleged that Brokers International Financial Services and Mr. Perry allowed Brian Simms, CEO of both Brendanwood Financial Brokerage and Brendanwood Financial Services, to use the company as a conduit to obtain funds from Mr. Wagner and convert those funds for his own personal use. According to the claim, Mr. Perry, who was responsible for its operations oversight, appears to be complicit in the actions of Mr. Simms.

According to public reports, Ms. Wagner also filed a lawsuit on December 2, 2019, in Hamilton Circuit Court against Brian Simms. The lawsuit alleged that Mr. Simms relied on Brian Simms after the 2017 death of her husband, Michael Wagner. Mr. Simms allegedly assisted Ms. Wagner in making death benefit claims on life insurance policies through North American Company for Life and Health Insurance and the Lincoln National Life Insurance Company and then convinced her to vest the proceeds in additional insurance, annuities, and investments. The lawsuit alleges in total, $1,342,482 of Ms. Wagner’s assets are missing and unaccounted for or misappropriated by Mr. Simms and Brendanwood.

GPB Automotive Portfolio, LP’s Latest Public Filing Raises Doubts That the Business Will Survive; Investors Should Contact an Attorney to Review Legal Rights

Published on: May 18, 2021 | by Iorio Altamirano

On Friday, May 14, 2021, GPB Capital Holdings LLC (“GPB Capital”), a private equity firm based in New York, registered some units in its GPB Automotive Portfolio, LP (“GPB Automotive”) with the Securities and Exchange Commission. As part of its filing, GPB Automotive disclosed that it had substantial doubt of its ability to continue operations. Specifically, GPB Automotive made the following risk factor disclosures to investors and potential investors:

We have determined that there is substantial doubt as to our ability to continue as a going concern, due to the expiration of the credit facility for the majority of our dealerships within 12 months, as well as certain other factors. Our inability to extend the maturity of our credit facility, or replace the credit facility, prior to its maturity in February 2022 would materially adversely affect our financial condition, results of operations, cash flows and business operations.
We may not have adequate funds to complete future capital improvement programs or to make additional acquisitions.

Orchard Securities Broker Alma Edwards Faerber Facing $1 Million Customer Claim

Published on: May 18, 2021 | by Iorio Altamirano

A FINRA customer complaint involving Orchard Securities broker Alma Edwards Faerber alleges that Ms. Faerber recommended alternative investments that were unsuitable. The claim, which was filed on December 11, 2020, is related to Ms. Faerber’s previous association with Triad Advisors. The claim seeks $1 million in damages.

Triad Advisors is one of the Advisor Group network broker-dealers. The firm was fined $150,000 by FINRA earlier this year for failing to adequately supervise short-term trades of mutual fund A shares and variable annuity exchanges. Last year, the firm reported three new investor claims related to private placements sales. According to InvestmentNews, per SEC filings, Advisor Group firms have increased legal reserves by about $4.4 million compared to the prior year.

Iorio Altamirano LLP is currently investigating claims on behalf of defrauded investors who were victims of the GPB funds scheme. GPB Capital sold unregistered, high commission limited partnership interests in eight alternative-asset investment funds. The GPB funds were marketed to independent broker-dealers and investment advisers who would, in turn, sell the GPB funds to their retail investors. According to publicly available records filed with the SEC, both Triad Advisors LLC and Orchard Securities, LLC likely received sales compensation for selling the GPB funds to retail investors.

Broker Jason Lynn DiPaola Investigated by FINRA – New York, NY

Published on: May 18, 2021 | by Iorio Altamirano

FINRA has filed an enforcement complaint against former Chardan Capital Markets LLC broker Jason Lynn DiPaola (CRD#: 2648836). Mr. DiPaola has 20 years of experience in the securities industry and was most recently registered as a broker with Chardan Capital Markets LLC in New York, NY, from May 2013 to May 2019.

If you have lost money with Jason Lynn DiPaola, or Chardan Capital Markets LLC, contact FINRA arbitration lawyers Iorio Altamirano LLP for a free and confidential evaluation of your account.

FINRA Enforcement Allegations

Former Morgan Stanley Broker in Miami, Candido Viyella, BARRED by FINRA

Published on: May 17, 2021 | by Iorio Altamirano

The Financial Industry Regulatory Authority (“FINRA”) has barred stockbroker Candido Viyella. from the securities industry. Mr. Viyella was expelled from the brokerage industry for refusing to cooperate with a FINRA investigation. FINRA’s investigation originated after Morgan Stanley discharged Mr. Viyella and disclosed concerns regarding his participation, involvement, and a beneficial ownership interest in an outside investment.

Reportedly, Mr. Viyella recommended that his clients invest in the Conrad Hotel, a luxury hotel in Fort Lauderdale, Florida, in which he had a personal stake. Mr. Viyella reportedly knew the hotel was facing financial difficulties, yet recommended that his clients invest in the hotel, causing them to suffer financial losses.

Mr. Viyella was registered with Morgan Stanley in Miami, Florida, from June 2009 until December 2020. He has also been associated with the following entities: Terrena Enterprises, LLC, VSHC Management, LLC, VSHC Family Limited Partnership LP, and Earthview Capital, LLC.

Former Securities America, Inc. Broker, Bill Dixon, BARRED from the Securities Industry by FINRA – Urbana, Ohio

Published on: May 17, 2021 | by Iorio Altamirano

The Financial Industry Regulatory Authority (“FINRA”) has barred stockbroker William Dixon. from the securities industry. Mr. Dixon was expelled from the brokerage industry for refusing to cooperate with a FINRA investigation. FINRA’s investigation originated after Securities America, Inc. discharged Mr. Dixon and alleged that he signed his deceased client’s signature and initials on multiple annuity surrender forms.

Mr. Dixon was registered with Securities America, Inc. in Urbana, Ohio, from September 2016 until October 2019.

If you have suffered financial losses investing with William Dixon or Securities America, Inc., contact New York securities arbitration law firm Iorio Altamirano LLP for a free and confidential review of your account.