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TAG | brokers involved in elder abuse

Mar/13

8

Wells Fargo Broker Barred by FINA and Ordered to Pay Back $650,000 to Client

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FINRA, the Financial Industry Regulatory Authority, barred a former Wells Fargo broker and ordered him to pay $650,000 plus interest to a former client on the grounds that the advisor allegedly defrauded a client of at least the same amount.

Adorean Boleancu opened two home equity lines of credit for an elderly, widowed client,  shortly after moving to Wells Fargo from Morgan Stanley early in 2008. From 2008 to January 2010, Boleancu converted funds from those credit lines by issuing checks in the client’s name “without her authorization and issuing those checks to others, including his girlfriend,” FINRA wrote.

According to a civil complaint, filed in the Superior Court of California in San Francisco in August of 2012, Boleancu also made an unsuitable investment of $2,000,000 in variable annuities and “risky equity funds.” The client discovered the investments, which had declined by $1,000,000, in January 2012 when she hired a new financial advisor, the civil complaint said.

“At all relevant times, the elderly client was an unsophisticated and inexperienced investor who relied completely on the professional advice and experience of Boleancu for her investments and safekeeping of her financial assets,” FINRA said in the letter. “Boleancu was aware of her lack of experience and sophistication at the outset of their relationship.”

FINRA barred Boleancu and ordered him to pay $650,000 restitution to the former client.

Call Soreide Law Group, and speak to an attorney regarding potential recovery of your losses at 888-760-6552.

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Jun/11

5

Finra files complaint against David Lerner Associates For REIT Sales to Elderly

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In a June, 2011, article from Bloomberg News, it was written that David Lerner Associates Inc. has been accused of targeting unsophisticated and elderly customers while selling real estate investment trust (REITs) shares without considering whether the illiquid security was suitable for its clients.

David Lerner Associates is based in Syosset, New York, and known for its “Take a tip from Poppy” advertising slogan, misled investors who bought more than $300 million of shares in the $2 billion Apple REIT Ten offering this year, the Financial Industry Regulatory Authority(FINRA) said in a disciplinary complaint on its website. The firm denies the allegations, according to a statement.

It was reported in the Bloomberg News article that David Lerner Associates solicited customers for Apple REIT Ten, it provided misleading information about distribution rates for a series of predecessor securities that are now closed to investors, Finra said. The figures failed to show that distributions far exceeded income and were funded by debt that increased leverage in the REITs, which invest in extended-stay hotels, the regulator said.  David Lerner Associates has sold almost $6.8 billion of Apple REIT shares to more than 122,000 customers since 1992, according to the Finra complaint, the industry-funded regulator for U.S. brokerages. Those sales have generated more than $600 million, accounting for more than 60 percent of the firm’s business since 1996, Finra said.

This complaint is the first step in a formal proceeding, Finra said. It isn’t filed in court, and the firm can request a hearing before a disciplinary panel, the regulator said in its statement.

“The firm conducted thorough due diligence of Apple REIT Ten’s offering documents and audited financial statements,” DLA said in its statement. “DLA will vigorously defend these claims. It looks forward to the opportunity to set the record straight and expects to be completely vindicated.”

Also, in the Bloomberg News article it was stated that in September, DLA paid a $255,000 fine for failing to provide required information in connection with the replacement of variable life insurance policies and annuity contracts from November 1998 through February 2004, according to the New York State Insurance Department. A year ago this month, DLA was accused by Finra of overcharging customers on sales of municipal bonds and mortgage securities. That case is still pending, according to Finra’s brokerage records.

If you or a family member have become a victim of the alleged fraudulent schemes of David Lerner Associates, Inc., call a Securities Arbitration Lawyer for a free consultation on how you could potentially recover you losses.  To speak with an attorney, call 888-760-6552, or visit www.stockmarketlawsuit.com. Soreide Law Group, PLLC., representing investors nationwide before FINRA  the Financial Industry Regulatory Authority.

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May/11

7

Jennifer J. Guelinas Barred by FINRA

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Jennifer J. Guelinas (CRD #2814512, Registered Representative, Valparaiso, Indiana)

On FINRA’s website it was announced that they had submitted a Letter of Acceptance, Waiver and Consent in which she was barred from association with any FINRA member in any capacity. Without admitting or denying the findings, Guelinas consented to the described sanction and to the entry of findings that she converted at least $500,000 from the brokerage accounts of senior citizen customers of
her member firm by signing, without authorization, wire transfer requests which resulted in the conversion of the funds from the customers’ accounts to outside bank accounts she controlled and to third parties; the customers did not authorize the transfers.

The findings included that Guelinas received compensation from a rental apartment she owned
and failed to disclose the real estate investments, the compensation from the investments
or the rental income to her member firm. FINRA found that Guelinas failed to disclose
material information on her Form U4.

The findings also stated that Guelinas, without authorization, signed wire transfer requests, real
estate purchase agreements and a promissory note on senior citizen customers’ behalf.
The findings also stated that Guelinas arranged and participated in real estate investments
with senior citizen customers of her member firm and received compensation.

(FINRA Case #2010025098101)

If you have become a victim of the alleged fraudulent schemes of Jennifer J. Guelinas, call a Securities Arbitration Lawyer for a free consultation on how you could potentially recover you losses.  To speak with an attorney, call 888-760-6552, or visit www.stockmarketlawsuit.com. Soreide Law Group, PLLC., representing investors nationwide before FINRA  the Financial Industry Regulatory Authority.

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Apr/11

13

Santander Securities Ordered by FINRA to Pay $2M to Settle Charges Brokers Sold Unsuitable Investments to Elderly

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Yesterday, in an article from Bloomberg News, we learn that Banco Santander SA, Spain’s largest bank, will pay $2 million to resolve U.S. regulatory claims that its Puerto Rico-based brokerage improperly sold risky structured financial products to retail customers including the elderly.

“Santander Securities failed its customers through significant deficiencies in its systems and procedures, which allowed unsuitable recommendations of concentrated positions in risky reverse convertibles,” Brad Bennett, Finra’s chief of enforcement, said in a statement. Santander resolved the claims without admitting or denying the allegations, Finra said.

It was reported that Santander Securities, which has reimbursed customers for more than $7 million in losses on so-called reverse convertible notes, failed to properly train brokers as sales grew in 2007 and 2008, the Financial Industry Regulatory Authority said today. The Washington-based regulator said last month that it was conducting a sweep to survey advertising for the securities.

These reverse convertibles, generally marketed to individuals, are short-term bonds that convert into stock if a company’s share price plummets. They offer high interest rates, with notes paying 13 percent on average last year, according to data compiled by Bloomberg. Banks sold $6.76 billion of the securities to U.S. investors last year, the data show.

Santander recommended in November, 2007, that a retired couple in their 80s, with a moderate risk tolerance and long- term growth objective, invest more than 85 percent of their account and more than half of their net worth in a single reverse convertible position, Finra said. The couple, who has since been reimbursed, lost $88,000 of a $100,000 investment on the deal, the regulator said.

Also, some brokers recommended that customers use funds borrowed from the firm’s banking affiliate to purchase the securities, claiming it would enable them to profit on the interest-rate spread between the instrument and the loan, Finra said. Those recommendations substantially increased the clients’ risk, and some people who lost money then owed additional funds to the bank when the notes lost value, the regulator said.

Ferris, Baker Watts LLC, which was acquired by Royal Bank of Canada in 2008, was ordered to pay $690,000 to resolve Finra’s claims that it failed to supervise reverse-convertible sales for these products. H&R Block Financial Advisors Inc., acquired by Ameriprise Financial Inc. in 2008, was fined $200,000 for a lack of supervisory systems. Neither brokerage admitted wrongdoing.

If you feel you have been an alleged victim of  your brokerage or broker selling you Banco Santander reverse convertible notes, call a Securities Arbitration Lawyer for a free consultation on how to recover your losses.  To speak with an attorney, call 888-760-6552, or visit www.stockmarketlawsuit.com. Soreide Law Group, PLLC., representing investors nationwide before FINRA  the Financial Industry Regulatory Authority.

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Jan/11

26

FINRA Sanctions Richard Totoy

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Richard Totoy (CRD # 5423558, Registered Representative, New York, New York) was barred from association with any FINRA member in any capacity. The sanction was based on findings that Totoy converted $1,000 from an elderly customer by using an automatic teller machine (ATM) card to withdraw the funds from the customer’s account without her knowledge or consent. The findings stated that Totoy admitted that he made the withdrawals and later returned the funds to the bank. The findings also stated that Totoy failed to respond to FINRA requests for information and to appear for a FINRA on-the-record interview.

This information is available on the FINRA website’s Disciplinary Actions.

If you have been a victim of the alleged fraudulent schemes of Richard Totoy, or a similar situation, call a Securities Arbitration Lawyer for a free consultation on how to recover your losses.  To speak with an attorney, call 888-760-6552, or visit www.stockmarketlawsuit.com. Soreide Law Group, PLLC., representing investors nationwide before FINRA  the Financial Industry Regulatory Authority.

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