closed end funds - Page 3 of 5 - Law Offices of Robert Wayne Pearce

46 search results found for “closed end funds”

Sep 27, 2017

FINRA Hits Morgan Stanley with $13 Million in Fines and Restitution for Inadequate Supervision of UITs

The Financial Industry Regulatory Authority (FINRA) announced today that it ordered Morgan Stanley Smith Barney LLC (Morgan Stanley) to pay $13 million in fines and restitution for failing to supervise the sales of unit investment trusts (UITs). FINRA found that from January 2012 through June 2015, hundreds of Morgan Stanley brokers executed short-term UIT rollovers in thousands of customer accounts. Further, FINRA found that Morgan Stanley failed to adequately supervise its representatives’ sales by failing to provide sufficient guidance or training to detect unsuitable short-term UIT trading.

Feb 10, 2017

BancWest Broker Barred by FINRA for Unapproved REIT Transactions

John Hudnall, a former broker with BancWest Investment Services, Inc. (BancWest), submitted an Offer of Settlement to the Financial Industry Regulatory Authority (FINRA) in which he was barred from the securities industry amid findings that he recommended and sold a REIT investment to an 80 year old customer, which he split into two transactions in order to circumvent his firm’s supervisory review. FINRA found that John Stuart Hudnall, of Pacifica, California, sold a $400,000 Wells Core Office Income REIT investment to an 80 year old customer. He then split it into two transactions, one of 40,000 and the other of $360,000, to avoid supervisory review of such a large transaction. Mr. Hudnall only submitted the $40,000 portion to his firm, and submitted the $360,000 portion directly to the REIT sponsor. Mr. Hudnall allegedly received a gross commission of $25,200 in connection with the $360,000 part of the REIT investment.

Dec 1, 2016

Merrill Lynch Hit with $7 Million Fine for Failing to Supervise Securities-Backed Leveraged Accounts

The Financial Industry Regulatory Authority (FINRA) has hit Merrill Lynch, Pierce, Fenner & Smith, Inc. (Merrill Lynch) with a fine of more than $7 million for failing to properly supervise its customers’ use of leverage in loan management accounts and for improper supervision regarding unsuitable and highly overconcentrated accounts invested in Puerto Rican municipal bonds and closed-end bond funds. Without admitting or denying the charges, Merrill Lynch consented to FINRA’s findings that it failed to adequately educate its representatives about its loan management accounts (LMAs) or train them on the differences between purpose and non-purpose LMAs. LMAs are lines of credit that enable customers to borrow money from, in this case, Bank of America (the owner of Merrill Lynch) using the securities in their accounts as collateral. FINRA notes that Merrill Lynch brokers earned compensation if the customers used the line of credit. Merrill Lynch must pay $6.25 million for its failure to supervise these LMAs.

Aug 29, 2016

Huntington Representative Barred, Ordered to Pay $800k Restitution for UIT Misrepresentations

David Miller of Columbus, Ohio was named Respondent in a Financial Industry Regulatory Authority (FINRA) complaint that alleged he made negligent misrepresentations and omissions of material fact in connection with customers’ purchases of UITs. FINRA alleged that Mr. Miller recommended 140 UIT purchases totaling over $5.3 million in 129 customer accounts without having a reasonable basis to make the recommendations, in violation of FINRA Rules 2111 and 2010. From June 2008 through August 2013, Mr. Miller was registered as a General Securities Representative (GSR) with The Huntington Investment Company (Huntington), the broker-dealer affiliate of The Huntington National Bank (Huntington Bank). The FINRA complaint originated after Huntington filed a Form U5 on August 27, 2013, disclosing that Mr. Miller had “violated industry standards of conduct.” Upon investigation, FINRA found that Mr. Miller engaged in a pattern of recommending unsuitable UITs without having a reasonable basis for the recommendations, causing his customers to lose a total of $1,019,656.83.

Aug 5, 2016

BancWest and US Bancorp Representative Name in FINRA Complaint Alleging Unsuitable Broker Activity

John Hudnall of Pacifica, California was named a Respondent in a Financial Industry Regulatory Authority (FINRA) complaint that alleged he participated in undisclosed and/or unapproved outside business activities while associated with a FINRA member firm. Mr. Hudnall entered the securities industry in 2000 and was associated with FINRA member firms BancWest Investment Services, Inc. (BancWest) and US Bancorp Investments, Inc. (US Bancorp) during the relevant period. FINRA alleged that Mr. Hudnall, while associated with US Bancorp and Bancwest, participated in an undisclosed and unapproved private securities transaction, made unapproved and undisclosed financial sales promotions to firm customers, recommended and sold an unsuitable variable annuity product and provided false information in response to FINRA information requests. FINRA’s investigators also alleged that in connection with an undisclosed securities transaction in May 2012, Mr. Hudnall artificially split a customer’s $400,000 REIT investment into two parts and submitted only the smaller part ($40,000) to his firm for supervisory review and approval generating himself $25,000 in ill-gotten commissions.

Feb 19, 2016

The Law Offices of Robert Wayne Pearce P.A. Wins $1.45 Million Plus Interest Award Against UBS Financial Services and UBS Puerto Rico

In an arbitration proceeding against UBS Financial Services, Inc. (UBS) and UBS Financial Services, Inc. of Puerto Rico (UBS-PR), the Law Offices of Robert Wayne Pearce, P. A. won a $1.45 million plus interest award for one of the firm’s clients this week. The case arose from a series of unsuitable investment recommendations made by a UBS and a UBS-PR financial advisor that our client purchase and hold an excessive concentration of UBS-PR closed-end bond funds in a leveraged UBS-PR account. Because of the financial advisors’ unsuitable recommendations, our client’s investment was not diversified from an asset allocation standpoint and also from a concentration standpoint, as the portfolio was overconcentrated in a single geographic area, namely, Puerto Rico.

Sep 17, 2015

The Law Offices of Robert Wayne Pearce P.A. Wins $600,000 Plus Interest Award Against UBS Puerto Rico

In an arbitration proceeding against UBS Financial Services, Inc. of Puerto Rico (UBS-PR), the Law Offices of Robert Wayne Pearce, P. A. won a $600,000 plus interest award for one of the firm’s clients this week. The case arose out of the alleged misrepresentations and unsuitable recommendations by a UBS PR financial advisor to our client that he purchase and then hold an excessive concentration of UBS-PR closed-end bond funds in his investment account. UBS-PR, through its representatives, made false representations and misleading statements to our client about both the nature and risk of the closed-end bond fund and investment strategy.

Mar 6, 2015

Former UBS Broker Decries the Marketing and Sale of Structured Products to Conservative Investors

Michael Hadden, a former broker with UBS Wealth Management (UBS), has made claims that UBS allegedly made it “impossible” for his to continue working due to “… its various unethical practices with respect to customers …” as stated in his original arbitration claim with the Financial Industry Regulatory Authority (FINRA). Mr. Hadden has asked a federal court, the U.S. District Court for the Western District of Kentucky, to overturn FINRAs arbitration award which ordered him to repay over $300,000 in bonus money, attorneys’ fees and interest. According to Mr. Hadden’s court filings, UBS would allegedly mislabel conservative investors as moderate in order to avoid future restitution and penalties. As Mr. Hadden noted in his court documents, “… the risk reporting system is done … to protect UBS from future claims of lack of suitability from the client or FINRA.”

Feb 26, 2015

FINRA Fines Oriental Financial Services for Failing to Supervise Puerto Rico Bond Fund Investments

Oriental Financial Services Corp. (Oriental) was fined $245,000 by the Financial Industry Regulatory Authority (FINRA) for failing to maintain a proper supervisory system to comply with Federal securities laws, namely, that its supervisory system failed to identify and review concentrated purchases of Puerto Rico municipal bonds and closed-end funds; and failing to disclose on customer confirmations the markups and markdowns for riskless principal transactions in Puerto Rico closed-end funds. Without admitting or denying the findings, Oriental consented to FINRA’s sanctions and findings that if failed to disclose approximately $2.9 million in markups and markdowns on customer trade confirmations. According to FINRA, Oriental’s registered representatives continued selling the municipal bonds and closed-end funds even after the municipal bond rating had been downgraded to junk status. Consequently, Oriental Financial Services has agreed to submit to FINRA the procedure of how it intends to properly identify, review and correct any unsuitable, concentrated Puerto Rico bond purchases.

Feb 18, 2015

Popular Securities Fined By FINRA for Failure to Supervise Puerto Rico Bond Fund Investments

Popular Securities, Inc. n/k/a Popular Securities, LLC, was fined $125,000 by the Financial Industry Regulatory Authority (FINRA) for failure to supervise violations involving over-concentration of investments in Puerto Rico municipal bonds and closed-end bond funds in many of its customers’ accounts. Without admitting or denying the findings, Popular consented to the sanctions and to FINRA’s findings that between July 1, 2011 and June 30, 2013, it failed to supervise its customers’ Puerto Rico bond fund investments, even after the bond rating had been downgraded to junk bond status. Following the junk bond downgrade, FINRA found that Popular Securities’ customers continued to purchase concentrated positions of the Puerto Rico securities.

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46 search results found for “closed end funds”