Securities Fraud Blog | Find out if your broker is liable for your losses

TAG | investment fraud

Feb/12

6

Key Biscayne Rep Barred by FINRA

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The following information appeared on FINRA’s website:
 
Ricardo Blanco (CRD #1793188, Registered Representative, Key Biscayne, Florida)
 
submitted a Letter of Acceptance, Waiver and Consent in which he was barred from association with any FINRA member in any capacity. Without admitting or denying the findings, Blanco consented to the described sanction and to the entry of findings that he sent documents that contained false and inflated account values to a customer and also sent the customer a false account statement, which indicated that the account’s value was approximately $3 million when, in fact, it was worth less than a dollar. The findings stated that Blanco sent a false account statement with an inflated value to another customer; the false statement indicated that the value of the account was approximately $2 million when the account had, in fact, been closed. The findings also stated that Blanco failed to respond to FINRA requests to provide certain documents and access to other documents.
(FINRA Case #2011027098601)
 
The above information was obtained on FINRA’s website under ‘Disciplinary Actions’ January, 2012, and at this point, has ended.
 
Securities Attorney, Lars Soreide, of Soreide Law Group, PLLC, has represented clients nationwide. If you or a family member have sustained investment losses due to Ricardo Blanco of Key Biscayne, FL, or to your stock broker or financial advisor’s recommendations, call for a free consultation on how to potentially recover your losses. To speak with an attorney call 888-760-6552, or visit our website at: www.stockmarketlawsuit.com.
 
Soreide Law Group, PLLC., representing investors nationwide before FINRA the Financial Industry Regulatory Authority.
 

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Jan/12

26

Doug Mirabelli, Ex-Red Sox backstop, Wins $1.2M in Damages from Merrill

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In a January 25th., 2012, article from InvestmentNews.com, the staff writes that Former Boston Red Sox catcher and two-time World Series winner Doug Mirabelli, who made a nice career of being the preferred backstop to knuckleballer Tim Wakefield, finally saw a pitch even he couldn’t handle.

In March 2008, the same month he was released by the Red Sox, Mirabelli and his wife invested $880,219 with Bank of America Merrill Lynch adviser Phil Scott and took out loans that brought their account value to $1.8 million, according to an article in The New York Times. Scott put the money into the Merrill Lynch Phil Scott Team Income Portfolios, a bundle of 33 dividend-paying growth stocks. The loans were made on the condition that the account not dip below $1 million.

The InvestmentNews.com article goes on to say that by November, the Mirabellis’ account had dropped below that level, and they liquidated it to cover the loans. The Mirabellis argued in arbitration that Scott had put his client’s money into unsuitable, all-growth-stock investments and improperly briefed the couple on the loans and their requirements.

This arbitration panel ruled in favor of the Mirabellis and awarded them $1.2 million to cover their initial investment, plus all legal fees and arbitration costs. This was the second defeat for Scott in the last 12 months, according to The New York Times article. Merrill has moved to vacate the previous award and it’s unclear if they will do the same with Mirabelli’s.

“We disagree with the panel’s decision given the facts presented in this case,” said Bill Halldin, a spokesman for Merrill. “This account was handled properly during a very difficult time when there was extreme market volatility.”

Doug Mirabelli, 41, earned roughly $7 million over a dozen seasons. He now works as a real estate agent in Michigan.

Securities Attorney, Lars Soreide, of Soreide Law Group, PLLC, has represented clients nationwide. If you or a family member have sustained investment losses due to your stock broker or financial advisor’s recommendations, call for a free consultation on how to potentially recover your losses. To speak with an attorney call 888-760-6552, or visit our website at: www.stockmarketlawsuit.com.
 
Soreide Law Group, PLLC., representing investors nationwide before FINRA the Financial Industry Regulatory Authority.

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Jun/11

16

BOYNTON BEACH MAN CHARGED WITH MAIL FRAUD IN “PONZI” SCHEME

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It was anounced on Florida’s Office of Financial Regulation, that on June 3, 2011 there was a filing of a Criminal Information against defendant Anthony F. Cutaia, 65, of Boynton Beach, Florida.  Cutaia made his initial appearance in federal court, and was released on a personal surety bond.  
 
The news-release states that the Information charges Cutaia with nine counts of mail fraud, in violation of Title 18, United States Code, Section, 1341.  More specifically, the Information alleges that Cutaia was the managing member and beneficial owner of CMG Property Investment Group, LLC, which purportedly engaged in commercial real estate investment.  Cutaia was also the host of “Talk About Mortgages and Real Estate,” a television and radio program. 
 
From March 2003 through December 2006, Cutaia entered into Contract Participation Agreements with investors according to the charges.  These contracts stated that investors’ money would be used solely to purchase real estate contracts in Palm Beach and Broward Counties and that CMG would not collect commissions or fees until the properties were sold and a profit was made.  In fact, however, Cutaia allegedly invested little of the investors’ money in real estate and instead used the investors’ money to make payments to pre-existing investors and to pay his own business and personal expenses.  
Have you or your family members become an alleged victim or Anthony F. Cutaia? Protect yourself and your investments from the unscrupulous brokers and brokerages who turn your investments into Ponzi schemes. Call a Securities Arbitration Lawyer at Soreide Law Group, PLLC, for a free consultation on how to potentially recover your investment losses.  To speak with an attorney, call 888-760-6552, or visit www.stockmarketlawsuit.com.

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Jun/11

16

Christian Genitrini Fined and Suspended by FINRA

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Christian Genitrini (CRD #3277581, Registered Representative, New York, New York)

submitted a Letter of Acceptance, Waiver and Consent in which he was fined $15,000,

suspended from association with any FINRA member in any capacity for two years, and

required to requalify by exam for Series 7 and Series 63 before becoming re-associated

with a member firm after the expiration of the suspension term. The fine shall be paid in

installments beginning 90 days after Genitrini’s reassociation with a FINRA member firm

following his suspension, or prior to the filing of any application or request for relief from

any statutory disqualification, whichever is earlier. Without admitting or denying the

findings, Genitrini consented to the described sanctions and to the entry of findings that

he advertised guaranteed returns on investments of up to 20 percent per year on a website

belonging to a company he wholly owned; Genitrini claimed that his company was a fullservice

investment firm and would, among other claims, provide high-yield investment

opportunities. The findings stated that the website declared that the company invested

nationwide and all industries were considered, but did not disclose the nature of the

investment product or the risks of investment. The findings also stated that Genitrini’s ads

appeared on other websites guaranteeing returns, and his company’s contemplated private

placement documents provided no assurance that by following its current investment

strategy, it would be successful or profitable; the subscription agreement also stated that

the investments the company carried might be volatile and present operational risks.

The findings also included that Genitrini’s Internet ads constituted communications with

the public; were not based on principles of fair dealing and good faith; were not fair and

balanced; did not disclose risks associated with the investment; guaranteed promising

returns that were exaggerated, unwarranted or misleading; and the predictions of

performance were also exaggerated or unwarranted.

FINRA found that Genitrini’s private offering of securities, which involved promissory

notes his company issued according to the private placement memorandum, was not

made pursuant to an effective registration statement filed with the SEC; the offering

was intended to be made pursuant to the exemption from registration in Section 4(2)

of Rule 506 of Regulation D of the Securities Act of 1933, which prohibits offers or sales

of securities by any form of general solicitation or general advertising. FINRA also found

that Genitrini’s use of the Internet and his company’s website violated Section 5 of the

Securities Act of 1933, and guaranteeing returns in the offer of securities over the Internet

violated Section 17(a)(1) of the Securities Act of 1933. In addition, FINRA determined

that Genitrini falsely described his work with his company on his member firm’s outside

business activity disclosure form and also failed to disclose that he maintained a website

for the company; Genitrini told his firm, in writing, that his business and website were for

tax-planning services.

The suspension is in effect from April 4, 2011, through April 3, 2013.

 

(FINRA Case #2010022859701)

 This information was obtained on FINRA’s website under the May disciplanary actions.

 

If you feel you have been a victim of the alleged fraudulent schemes of Christian Genitrini, 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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Jun/11

16

Robin Bush, Fined and Suspended by FINRA

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 Robin Fran Bush (CRD #1994431, Registered Principal, Coral Springs, Florida) submitted a Letter of Acceptance, Waiver and Consent in which she was fined $15,000 and suspended from association with any FINRA member in any principal capacity for six months. The fine must be paid either immediately upon Bush’s reassociation with a FINRA member firm following her suspension, or prior to the filing of any application or request for relief from any statutory disqualification, whichever is earlier. Without admitting or denying the findings, Bush consented to the described sanctions and to the entry of findings that, as her member firm’s CCO, she was responsible for creating, maintaining and updating her firm’s WSPs and for conducting due diligence for private offerings. The findings stated that Bush’s firm approved for sale, and sold, various private offerings and for one offering, Bush’s due diligence consisted of reviewing the PPM and investor subscription documents, but she did not seek or obtain financial documents or information from the issuer regarding the offering, did not obtain any due diligence report, did not visit the issuer’s facilities or meet with its key personnel. The findings also stated that Bush did not take steps to ensure, or otherwise verify, that other firm principals were conducting any due diligence of the offering’s issuer. FINRA found that the firm and Bush obtained a third-party due diligence report after firm customers had already invested in the offering. FINRA also found that for a third private offering her firm approved for sale and sold, Bush conducted due diligence after the product had been sold to customers; Bush’s due diligence consisted of obtaining investor subscription documents without obtaining PPMs for the offerings, did not obtain any due diligence report from an independent third party and did not meet with any executives to understand the nature of the offerings.

 

In addition, FINRA determined that Bush’s firm sold additional, different unregistered offering to customers, and Bush, acting in her capacity as CCO and the designed principal for private offerings, failed to conduct due diligence for each of these other offerings. Moreover, FINRA found that the firm’s supervisory system and the firm’s written procedures for private offerings Bush drafted and maintained were deficient; these procedures Bush drafted and maintained did not identify, in any detail,specific due diligence steps to be taken for private offerings or identify specific documents to be obtained for private offerings the firm was contemplating selling.

Furthermore, FINRA found that the firm’s written procedures for private offering due diligence were conclusory, non-specific and lacking in the requisite minimum detail regarding steps to be taken and firm personnel responsible for such steps. The suspension will be in effect from September 7, 2011, through March 6, 2012.

 (FINRA Case #2009016159402) 
 This information was obtained on FINRA’s website under “May, 2011, Disciplanary and Other Actions.”
 
 If you feel you have been a victim of the alleged fraudulent schemes of  Robin Fran Bush, 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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Jun/11

15

Pricing Gap Revealed in Apple REIT Eight

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David Kelly of InvestmentNews.com, June 15, 2011, writes that the price of one in a series of 10 nontraded REITs sold exclusively through David Lerner Associates Inc. took a hit yesterday when management from Apple REIT Eight Inc. said that its book value was $7.57 per share at the end of March, according to a filing with the Securities and Exchange Commission. That’s in contrast to the $11-per-share price that Apple REIT Eight posted last week in a separate SEC filing and had consistently listed as an estimated share price on client account statements.

With about 370 registered reps, David Lerner Associates, has been on the hot seat over pricing of the Apple REITs since the end of May, when the Financial Industry Regulatory Authority Inc. filed a complaint against the firm in which it voiced concern over the fact that it had marketed shares in Apple REITS that hadn’t been re-priced in years. Finra said in the complaint that it was misleading to investors not to reflect the updated value of the REITs on the David Lerner Associates website, especially in those cases where the REITs were paying dividends with principal and borrowed funds instead of operating income. David Lerner Associates allegedly violated Finra suitability rules selling the Apple REITs, according to the complaint, and could face Finra fines and potentially pay restitution to clients.

David Lerner Associates has been the sole underwriter and distributor of the 10 REITs since 1992, most of them dubbed Apple REITs, that have issued $6.8 billion in securities, according to the Finra complaint. Investors have been attracted to the REITs’ steady dividends of 7% to 8%.

Apple REIT Eight took the step to restate its value in order to recommend to the owners of the REIT not to sell shares in response to a $3 tender offer by a series of pooled investment funds managed by Mackenzie Patterson Fuller LP, which buys illiquid real estate investments at deep discounts according to yesterday’s filing with the SEC.

“The board of directors believes that the offer price represents an opportunistic attempt by the bidders to purchase units at an unreasonably low price and as a result, deprive the stockholders who tender the units of the potential opportunity to realize the long-term value of their investment in the company,” the company said in the filing.

Kelly writes, adding to the confusion over the value of Apple REIT shares, David Lerner client account statements report an estimated value of $11 per share, said a plaintiff’s lawyer in New York. He said that he had spoken with about two dozen David Lerner investors, but had so far not filed any complaints against the firm.

An SEC filing on Apple REIT Ten Inc. yesterday stated that a member of the board of directors, Ronald Rosenfeld, resigned earlier this month. The board plans to fill his seat at a later date.

The InvestmentNew.com article goes on to say that accurate pricing of shares of the illiquid, long-term nontraded REITs has been an issue for almost two years. Before 2009, the common practice in the brokerage industry was to list the share price on client account statements at par value, or the amount at which the broker-dealer sold it, with the product typically priced at $10 or $11 a share.

Finra told broker-dealers that they needed to adjust the prices on the investments more frequently in 2009. In a notice to members, Finra said that it was prohibiting broker-dealers from using information that was more than 18 months old to estimate the value of a nontraded REIT.

If you or a family member have become a victim of the sale of Apple REITs by David Lerner Associates, Inc., call a Securities Arbitration Lawyer for a free consultation on how you could potentially 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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Jun/11

14

FRAUD CHARGES BROUGHT BY SEC IN SILICON VALLEY REAL ESTATE INVESTMENT SCHEME

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On the U. S. Securities and Exchange Commission’s website, it was announced that the Securities and Exchange Commission (SEC) charged Mountain View, Calif.-based JSW Financial Inc. and five officers for defrauding investors in two real estate funds, alleging that the firm used investor funds to prop up the officers’ own failing real estate development projects while concealing the loss of $17 million of investors’ money.

In the article it says that the SEC alleges that from 2002 to 2008, JSW and its predecessor, Jim Ward & Associates (JWA), created two real estate investment funds – Blue Chip Realty Fund and Shoreline Investment Fund – and told investors that their money would be used to make loans secured by residential real estate. In reality, according to the SEC, the firms’ officers used most of the money to make unsecured and undocumented loans to entities that the officers themselves controlled, which were suffering mounting losses and protracted delays on Silicon Valley real estate development projects. Meanwhile, as the enterprise collapsed, investors continued receiving monthly statements showing steady growth in the value of their portfolios.

In the SEC’s complaint, filed in federal district court in San Francisco, names as defendants founder James S. Ward and Edward G. Locker (both of Ohio) and David S. Lee, Richard F. Tipton and David C. Lin (all Silicon Valley residents). The complaint alleges that JSW and JWA, through these individual officers, breached their fiduciary duties by misusing investors’ money to benefit the officers rather than the funds. The SEC also alleges that the officers concealed millions of dollars in losses from Blue Chip and Shoreline investors by sending fraudulent account statements claiming that the Funds were earning more than 10% in annual profits, until the scheme collapsed in November 2008 and the officers finally revealed to investors that nearly all of the Blue Chip and Shoreline loans were unsecured. The SEC also alleges that Ward and Locker together took $900,000 of investor money to purchase homes for themselves.

On the SEC’s website it was announced that the SEC’s complaint charges JSW, Ward, Lee, Locker, Tipton and Lin with violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint also charges JSW with violating Sections 206(1), 206(2) and 206(4) of the Investment Advisers Act of 1940 (Advisers Act) and Rule 206(4)-8 thereunder, and charges Ward, Lee, Locker, Tipton and Lin with aiding and abetting violations of Sections 206(1), 206(2) and 206(4) of the Advisers Act and Rule 206(4)-8 thereunder. The SEC seeks injunctive relief and disgorgement of ill-gotten gains against JSW, Ward, Lee, Locker, Tipton and Lin, as well as monetary penalties against the five officers. The complaint also seeks disgorgement of ill-gotten gains and appointment of a receiver over Blue Chip and Shoreline as relief defendants.

If you feel you or a family member has become an alleged victim of  JSW Financial Inc., Jim Ward & Associates, James Ward, Edward Locker, David Lee, Richard Tipton , David Lin, or a similar situation, call a Securities Arbitration Lawyer for a free consultation on how to recover your investment 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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Jun/11

14

INVESTMENT ADVISER, FUND MANAGER, AND TWO INDIVIDUALS WITH CHARGED BY SEC WITH SECURITIES FRAUD INVOLVING CLIENT FUNDS

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Recently on the US Securities and Exchange Commission’s website, they announced the filing of a civil injunctive action in U.S. District Court in Los Angeles, California against MAM Wealth Management, LLC (MAM), MAMW Real Estate General Partner, LLC (MAMW), Alex Martinez and Ralph Sanchez, alleging fraud in connection with client investments in a $10.3 million risky real estate venture.

According to the Commission’s complaint, from July 2007 through March 2009, Martinez, a MAM and MAMW principal, and Ralph Sanchez, a MAM registered representative and MAMW principal, had 50 of their advisory clients invest in MAM Wealth Management Real Estate Fund, LLC (Fund). The complaint alleges that Martinez and Sanchez misrepresented to some clients that the Fund was a safe, relatively liquid investment, was earning 9% per year, and would show profits in three years. The complaint alleges that they used their discretionary authority over other clients’ funds to invest them in the Fund, even though it was unsuitable for their conservative investment goals. The complaint alleges that many accounts were retirement accounts and that the Fund was an unsuitable investment for clients who did not have the ability and willingness to accept the risks of losing their entire investment. The complaint further alleges that the defendants caused the Fund to use client funds to make risky mortgage loans.

On the U.S. Securities and Exchange Commission’s website they write that there was a complaint alleging that the defendants have violated the antifraud provisions of the federal securities laws, including violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder by MAM, MAMW, Martinez and Sanchez and Sections 206(1) and 206(2) of the Investment Advisers Act by MAM and Martinez and aiding and abetting violations of Sections 206(1) and 206(2) of the Investment Advisers Act by Sanchez. The SEC seeks permanent injunctions, disgorgement of ill-gotten gains plus prejudgment interest, and monetary penalties.

If you feel you or a family member has become an alleged victim of  MAM, MAMW, Alex Martinez, Ralph Sanchez or any of their brokers, or a similar situation, call a Securities Arbitration Lawyer for a free consultation on how to recover your investment 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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Jun/11

12

FINRA Fines Northern Trust Securities $600,000 for Failure to Supervise Accounts

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FINRA, the Financial Industry Regulatory Industry, has found that during an 18 month period, Northern Trust Securities, failed in their supervision and monitoring of 43.5% of their total business.

FINRA also stated that “Northern Trust failed to monitor customer accounts for potentially unsuitable levels of concentration in CMOs, in large part because it used an exception reporting system that failed to capture or analyze substantial portions of the firm’s business”.  

These FINRA findings raise questions and doubts about broker-dealer reporting systems in general.  The failure of this supervision and exception reporting is not a question of software or technology.  Almost every failure of an automated exception reporting system relates to very human error in the design and implementation of the exception reporting rules and criteria.   These rules and criteria are established by the individual broker-dealer that implements an automated exception reporting system.  The software provider is providing the means and opportunity to generate the exception reporting.  The broker-dealer is defining the rules and establishing analysis standards.  FINRA reported that almost 50% of Northern Trust Securities business went without analysis, including all of the trading in CMO’s.   The potential risk to investors of over-concentration in CMO’s during the period in question, October 2006 to October 2009, would dwarf the amount of the FINRA fine.

It should not have gone unnoticed by Northern Trust that such a large percentage of their overall business was “escaping” surveillance.  Having such a large percentage of a broker-dealer’s business pass without analysis may be dramatic but, then again, what percentage is acceptable?  Implementation of an automated exception reporting system by a broker-dealer is only the beginning of a compliance and surveillance process.  An automated exception reporting system requires constant monitoring and audit.  In the absence of that, the broker-dealer exposes their business to severe potential failures of supervision and exception reporting. 

If you or a family member have invested with Northern Trust and feel your account was not properly supervised, call a Securities Arbitration Lawyer for a free consultation on how you could potentially 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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Jun/11

12

Report Says That Structured Products Are ‘Absurdly Destructive’ for Retail Investors

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In a June 10, 2011, article in InvestmentNews.com, Liz Skinner writes that structured notes and other derivatives products have been marketed by Wall Street as safe and secure investments. Of course, Skinner writes, there’s safe and then there’s safe. Retail investors of all stripes have lost at least $113 billion by purchasing these purportedly safe instruments, according to a new study conducted by the nonpartisan policy center Demos and The Nation Institute, a media think tank.

“In my three decades of Wall Street experience, I have not seen any other product as absurdly destructive as retail investments linked to structured products,” securities arbitration consultant Louis Straney wrote in the report.

Considering financial institutions appear to be ramping up the sales of these products,that’s worrisome. Indeed, structured notes with principal protection are among the most popular products being pitched to income-oriented investors, the study said. These investments combine a zero-coupon bond and an option whose payoff is linked to an underlying asset, index or benchmark, or a basket of benchmarks. The notes, which pay off based on the performance of the linked index, can provide reasonable returns and upside potential — certainly attractive given today’s puny money market and CD rates.

Liz Skinner writes that last year, banks and brokers sold more than $52 billion in structured notes, according to the study. In the past, the notes were sold strictly to sophisticated institutional investors. In recent years, however, structured notes have been repackaged and sold to retail investors — often, senior citizens —as a principal protection tool. But as the name implies, structured products can be complex. Last week, regulators warned investors that structured notes with principal protection often come with confusing terms, low guarantees and can tie up money for as long as a decade. The alert from the Securities and Exchange Commission and the Financial Industry Regulatory Authority Inc. stressed that the investments are not risk-free.

The SEC said principal-protected notes vary wildly by issuer and that investors tend to ignore or don’t understand what is spelled out in prospectuses. Also, the commission warned that principal-protected notes do not always protect principal. Some issuers of principal-protected notes guarantee only a certain amount of the principal — in some cases, as little as 10%. Sometimes, the principal is protected only if a contingency stipulated in the prospectus is met. Other sellers of the notes do guarantee 100% of principal. But even that’s not a lock. If the issuer of the note goes bankrupt, the investor likely will lose all or most of the money invested.

The InvestmentNews.com article goes on to say that in April, for example, UBS Financial Services Inc. agreed to pay $10.7 million in fines and restitution to settle Finra allegations that its advisers misled investors about the “principal protection” feature of structured notes issued by Lehman Brothers Holdings Inc. that it sold a few months before that firm collapsed. In its complaint, Finra said that some UBS advisers didn’t understand the complexity of the 100% principal-protected notes that Lehman issued and failed to tell investors that they were unsecured obligations. In settling the case without admitting wrongdoing, UBS said that it was pleased to have the matter resolved and that most structured-product sales had been done properly.

Skinner writes that the Securities Industry and Financial Markets Association, which represents most Wall Street firms, did not respond to a request for comment Thursday about the suitability of structured products for retail investors.

They Are A Scared Group

The $113 billion that the report said individuals have lost includes more than just investments in principal-protected notes. It also included auction-rate securities, as well as certain municipal bond hedge funds (as reported by regulators or lawyers monitoring losses).

“Ninety-nine percent of the $113 billion cited is not to be attributed to the structured products industry, in particular principal-protected notes, which by and large have performed superbly in this volatile market environment,” said Keith Styrcula, spokesman for the Structured Products Association.The only losses from structured notes have been those from the Lehman bonds — probably less than one billion dollars in the U.S., he said.

Abuses relating to structured products and/or derivatives have been reported in about a third of the 50 states. The director of Alabama’s securities commission, Joe Borg, said he’s looking into cases involving income-oriented investments that lost money.

“There’s no doubt that structured products are targeted toward older folks,” Mr. Borg wrote in the report. “There’s the issue of outliving their money when it is tied up in low-yielding CDs and bonds. They’re a scared group.”

If you feel you have been an alleged victim of  your broker/brokerage selling you unsuitable structured notes, please 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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