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Parkland Securities, LLC (Parkland) f/k/a Sammons Securities Company, LLC, was fined $100,000 by the Financial Industry Regulatory Authority (FINRA) for numerous failure to supervise violations. Without admitting or denying the findings, Parkland consented to the sanctions and to FINRA’s findings.

FINRA found that Parkland relied too heavily upon an outside entity with a limited number of persons to conduct all of the supervisory and compliance functions for its 1,274 registered representatives and 854 branch offices. Also, FINRA found that Parkland’s system for reviewing its employees’ emails was inadequate, as was its system for the supervision of its customers’ confidential information, such as ensuring its representatives were using passwords, anti-virus software and anti-spyware tools. Continue reading →

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Candius J. Bannister, of Sarasota, Florida, was named a respondent in a Financial Industry Regulatory Authority (FINRA) complaint alleging that she borrowed $31,500 from a customer in violation of her member firm’s and FINRA’s rules.

Formerly registered with both Edward Jones and Morgan Stanley, both Florida based broker dealers, the now unregistered Candius Bannister is alleged to have borrowed a total of $31,500 from a customer while employed with Edward Jones. She allegedly has not repaid the loans, as required by the promissory notes, and she allegedly neglected to request or receive pre-approval from Edward Jones with respect to the loans. Candius Bannister is alleged to have violated the rules of both Edward Jones and FINRA as a result of these transactions. Continue reading →

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Herbert Leonard Kaye, a Delray Beach, Florida based broker with First Allied Securities, Inc. (First Allied), submitted a letter of acceptance, waiver, and consent in which he consented to, but did not admit to or deny, the Financial Industry Regulatory Authority’s (FINRA) findings that he entered discretionary trades in a customer’s account without the necessary prior written customer authorization.

FINRA found that although Herbert Kaye had the verbal consent of his customer, he neglected to obtain the necessary written consent when he entered over 2,000 trades in equities and exchange traded funds (ETFs) in the customer’s account and generated over $173,000 in commissions. FINRA’s findings state that Herbert Kaye also recommended that his customer invest $1.1 million in a gold and precious minerals mutual fund, for which he received $11,000 in gross commissions. This mutual fund recommendation was unsuitable in light of the customer’s age, investment objectives, and the fact that Herbert Kaye allegedly knew that his customer wanted to avoid investments with large market fluctuations. Continue reading →

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James Clifford Eastman, a former broker with Westport, Connecticut based Westport Resources Investment Services, Inc. (Westport), submitted a letter of acceptance, waiver, and consent in which he consented to, but did not admit to or deny, the Financial Industry Regulatory Authority’s (FINRA) findings that he participated in private securities transactions without giving prior written notice to Westport and without receiving the necessary approval from his employer.

FINRA found that James Eastman referred three Westport customers to invest in an oil and gas limited partnership offered by Quest Energy Management Group, Inc. (Quest). The offering interest was in the Permian Advanced Oil Recovery Investment Fund 1, LP (Permian). Mr. Eastman referred the three Westport customers to Quest, allegedly assisting the customers in obtaining the investment funds from their Westport brokerage accounts in order to effect the transactions. FINRA stated that the customers invested $875,000 in the Permian securities offering. Continue reading →

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In the last month, the Law Offices of Robert Wayne Pearce has gathered clients and facts from the Pinellas County Circuit Court files relating to the Tri-Med Ponzi Scheme. It appears that the Tri-Med Lawsuit Defendants and others, including sales agents who worked outside the Tri-Med organization as stockbrokers, investment advisors, accountants have schemed or unwittingly assisted and profited from the scheme to offer and sell at least $13 million in unregistered securities in the form of “notes,” “evidence of indebtedness” and “investment contracts” in violation of the registration and anti-fraud provisions of Chapter 517, Florida Statutes.

The perpetrators of the scheme made false claims and purported above market rates of return to lure investors, including the Plaintiffs, into making purported investments in medical practice related account receivables securitized by so-called letters of protection (“Letters of Protection”). Only a small portion of the at least $13 million raised from investors has been used to purchase medical practice accounts receivable. Instead, the Tri-Med Lawsuit Defendants used the majority of the funds to pay off earlier investors, pay for other items not disclosed to investors, or to disburse among themselves. Continue reading →

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The U.S. Commodity Futures Trading Commission (CFTC) has charged Emini Experts LLC (Emini), Capital Trading Concepts LLC (Capital Trading), and Dante S. Giovannetti (Giovannetti), all of Orlando, Florida, with a fraudulent investment scheme in which they used fictitious trading account statements to solicit nearly $700,000 from investors.

The CFTC complaint alleges that the false trading account statements show tens of millions of dollars in fictitious profits from trading Emini S&P 500 futures contracts and over $53 million in cash on deposit as of July 31, 2014. The complaint further alleges that Emini, Capital Trading, and Giovannetti acted as unregistered Commodity Pool Operators and co-mingled pool funds with non-pool property. Continue reading →

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The Financial Industry Regulatory Authority (FINRA) and the Securities and Exchange Commission (SEC) have issued an alert to warn investors of fraudulent penny stock scams touting what may essentially be stocks of dormant shell companies which have little to no business operations or non-cash assets and pose the threat of substantial financial losses for those who invest in them.

The SEC’s alert notes that fraudsters use dormant shell companies in what are known as pump-and-dump schemes. These schemes involve the buying of shares in the shell company, claiming the company to be a great investment opportunity, even hyping up the company with aggressive marketing and the announcing of new management or re-incorporation, possibly under a new name. All of these tactics are meant to “pump” the company stock back to life, thereby creating more trading and getting the stock prices to shoot up. Continue reading →

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The Securities and Exchange Commission (SEC) has fined 13 brokerage firms, including Charles Schwab, J.P. Morgan, Oppenheimer, TD Ameritrade, and UBS Financial, for violating a rule that is meant to protect investors from improper sales of high-risk Puerto Rican municipal bonds. The fines range from $54,000 to $130,000.

The SEC sanctions are the first under the Municipal Securities Rulemaking Board (MSRB) Rule G-15(f), which establishes the minimum denomination requirement for the sales of municipal bonds. The minimum denomination amounts are the least amount of a given municipal bond that a broker dealer is permitted to sell to an investor in one transaction. The more risky the bond, the higher the minimum. This is meant to ensure that the bond investments are suited to the appropriate investor. Continue reading →

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The Florida Office of Financial Regulation (FL-OFR) filed a complaint on March 5, 2014 against Tri-Med Corporation; Tri-Med Associates, Inc., and Jeremy Anderson, Anthony N. Nicholas, III, Eric Ager, Irwin Ager, and Teresa Simmons Bordinat, a/k/a Teresa Simmons (collectively referred to as “Defendants”) alleging that Tri-Med and the Defendants fraudulently offered and sold more than $13 million in unregistered securities. Continue reading →

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Ane S. Plate, a former registered representative with Orlando, Florida based Wells Fargo Advisors Financial Network, LLC (Wells Fargo), consented to, but did not admit to or deny, the sanction and the entry of the Financial Industry Regulatory Authority’s (FINRA) findings that she effected 15 unauthorized trades from a customer’s Wells Fargo account, and converted the proceeds of those unauthorized trades for her personal use and benefit. Continue reading →