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Jan 30, 2015

Girard Securities Subject of Massive SEC Audit Focusing on Branch Office Supervision

Girard Securities, Inc. (Girard Securities) is the subject of a massive audit by the U.S. Securities and Exchange Commission (SEC). The primary focus of the audit will be on the supervision of the registered representatives and financial advisors in its branch offices. With over 230 producing registered reps and financial advisors, the big question is, How will Girard Securities fare under the microscope of the SEC? Girard Securities has been acquired by RCS Capital Corp., an acquisition awaiting the approval of the Financial Industry Regulatory Authority (FINRA). Approval is expected at the end of February, according to a memo from Girard Securities’ Chairperson and Chief Executive, Susie Woltman Tietjen. RCS Capital Corp.’s purchase of Girard Securities, plus its August 2014 purchase of VSR Financial, with its 264 registered representatives and financial advisors, means that RCS Capital Corp. will have nearly 9,700 registered reps and advisors! It appears that the SEC is right on target with its audit priority of branch office supervision!

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Jan 29, 2015

Oppenheimer Admits Guilt to Penny Stock Pump and Dump Schemes

As part of concurrent settlements with the Securities and Exchange Commission (SEC) and the Financial Crimes Enforcement Network (FinCEN), Oppenheimer & Co. Inc. (Oppenheimer) has admitted it is guilty and agreed to pay $20 million for engaging in unregistered sales of penny stocks. According to the SEC Order, one Oppenheimer Financial Advisor and his immediate supervisor, an Oppenheimer Branch Office Manager, engaged in the sales of 2.5 billion shares of unregistered penny stocks for an investor customer. Those trades generated $12 million, of which Oppenheimer was paid $588,400 in commissions. The SEC Order states further that Oppenheimer personnel was aware of red flags indicative of illegal unregistered penny stock trades and failed to property follow up on those warning signs. Further, Oppenheimer failed to supervise its employees by failing to establish procedures to ensure its employees comply with Section 5 of the Securities Act.

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Jan 28, 2015

Gold Coast Bullion and Anthony Lauria Ordered to Pay CFTC Nearly $10 Million for Precious Metals Fraud

The U.S. Commodity Futures Trading Commission (CFTC) has ordered Florida resident Anthony Lauria and his Fort Lauderdale, Florida based company, Gold Coast Bullion, Inc., to pay nearly $10 million for committing illegal off-exchange precious metals fraud. The CFTC Order states that Gold Coast Bullion used telemarketers to solicit customers to invest in financed precious metals transactions. According to the CFTC Order, Anthony Lauria and the Gold Coast Bullion telemarketers represented to investors that in order to purchase the precious metals, they needed to deposit about 25% of the total metal value, that Gold Coast Bullion would arrange for the investor to receive a loan for the remaining 75%, and the investor would pay a finance charge on the loan.

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Jan 23, 2015

LPL Financial Advisor Marc Baldinger Suspended for Unauthorized Securities Transactions

Marc Halan Baldinger, a former broker with the Stuart, Florida branch of LPL Financial LLC (LPL Financial), 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 the necessary written approval from his employer. FINRA found that Marc Baldinger assisted 20 clients, who invested a combined total of more than $12 million in Government National Mortgage Association Interest Only bonds (GNMA I/Os), in establishing accounts with other brokerage firms. According to FINRA, Mr. Baldinger received approximately $233,427 in compensation for his role in the sales of the GNMA I/Os; and all of these securities transactions were without the approval of his member firm, LPL Financial. FINRA also found that Mr. Baldinger failed to disclose his position as a managing partner of two limited liability companies, that he failed to disclose that he had opened an account with a broker dealer that was not LPL, and that he also failed to disclose to the non-LPL broker dealer that he was a registered representative.

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Jan 22, 2015

Former LPL Financial Broker Jodie Miller Suspended for Sales of Unregistered Tri-Med Securities

Jodie Linn Miller, a former broker with Tampa, Florida based LPL Financial, Inc. (LPL) and VALIC Financial Advisors, Inc. (VALIC), submitted a letter of acceptance, waiver, and consent in which she consented to, but did not admit to or deny, the Financial Industry Regulatory Authority’s (FINRA) findings that she participated in unauthorized sales of unregistered Tri-Med securities to 14 investors. FINRA found that Jodie Miller, of St. Petersburg, Florida, participated in the sale of unregistered Tri-Med notes to 14 investors. The Tri-Med notes ranged from $10,000 to $150,000 and Ms. Miller allegedly received approximately $38,225 in commissions from Tri-Med for the sales. According to FINRA, Ms. Miller neglected to tell both LPL and VALIC about her involvement with Tri-Med, nor did she obtain the necessary approval from the member firms to sell the unregistered Tri-Med notes.

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Jan 13, 2015

Former LPL Financial and Financial Network Stockbroker Robert Mangold Suspended by FINRA

Robert Charles Mangold, a former registered representative with Financial Network Investment Corporation (Financial Network) and LPL Financial LLC (LPL) 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) sanction and findings that he solicited and received $56,000 in loans from two customers.

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Dec 30, 2014

FINRA Fines and Suspends Calton & Associates’ Dennis Witthoeft for Discretionary Trade Violations

Dennis Todd Witthoeft, a Wesley Chapel, Florida based broker with Calton & Associates, Inc. (Calton), consented to, but did not admit to or deny, the Financial Industry Regulatory Authority’s (FINRA) findings that he improperly exercised discretion in a customer’s account. While employed with Calton & Associates, Inc., of Tampa, Florida, FINRA found that Dennis Witthoeft exercised improper discretion when he effected a total of 61 stock and option transactions in a customer’s account at the end of the business days on which the customer had authorized the transations. Further, Dennis Witthoeft allegedly neglected to obtain written authorization from the customer allowing such use of discretion and the account had not been accepted by Calton as a discretionary account.

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Dec 5, 2014

Parkland Securities Fined $100,000 By FINRA for Numerous Failure to Supervise Violations

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.

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Dec 1, 2014

FINRA Files Complaint Against Former Edward Jones Broker Candius Bannister

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.

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