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FINRA Files Complaint Against Newport Coast Securities Broker For Allegedly Converting Customer Funds

David Braeger, of Bayside, Wisconsin, was named a respondent in a Financial Industry Regulatory Authority (FINRA) complaint alleging that he converted $33,000 of his customers’ funds and misrepresenting to the customers, through falsely stated quarterly reports and tax documents, that their investment funds were invested as they had instructed.

Formerly registered with Newport Coast Securities, Inc., an Irvine, California based broker dealer, the now unregistered David Oscar Braeger is alleged to have obtained a total of $30,000 from his customers, who instructed him to invest the funds in a private offering for Rubicon Capital Appreciation Fund (Rubicon), an entity that Mr. Braeger founded and managed.  However, Mr. Braeger allegedly never invested the customers’ funds as instructed and allegedly never returned the funds to his customers.

FINRA notes in its Complaint that Mr. Braeger concealed his conversion with a series of written and spoken false statements made repeatedly to his customers.  For example, Mr. Braeger allegedly misrepresented to the clients that Rubicon was an open fund, when it had been closed and liquidated.  Further, Mr. Braeger is alleged to have provided quarterly statements to his customers that falsely stated that their money was invested in Rubicon.  Finally, Mr. Braeger allegedly misled his clients further by providing them with tax documents which falsely ascribed a value for their interest in Rubicon, even though Mr. Braeger allegedly closed, liquidated and dissolved the fund.

Stockbrokers, registered representatives, and other financial professionals have been known to engage in many types of fraudulent and prohibited behavior which are in violation of industry rules and procedures.  In order to protect investors from stockbroker misconduct, FINRA rules require broker-dealers to establish and implement a supervisory system in order to safeguard customer assets.  If broker-dealers and their supervisors fail to establish and implement these protective measures, they may be liable to account holders for investment losses.  As a result, account holders who have suffered losses stemming from a registered representative’s misconduct can file a claim to recover damages against broker-dealers, like Newport Coast Securities, which have a duty to supervise its employees in order to prevent the above-described misconduct.

Have you suffered losses in your Newport Coast Securities account due to a stockbroker’s misuse of your funds or other stockbroker misconduct?  If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation.  Mr. Pearce is accepting clients with valid claims against Newport Coast Securities stockbrokers who may have engaged in misconduct and caused investors losses.

The most important of investors’ rights is the right to be informed!  This Investors’ Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida.  For over 35 years, Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities and investment law issues.  The lawyers at our law firm are devoted to protecting investors’ rights throughout the United States and internationally!  Please visit our website, www.secatty.com, post a comment, call (800) 732-2889, or email Mr. Pearce at pearce@rwpearce.com for answers to any of your questions about this blog post and/or any related matter.