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Real Estate Promoter Gets 19 Years For Texas Ponzi Scheme

By Pete Brush of law360.com Law360, New York (March 30, 2016, 5:49 PM ET) -- Real estate investment manager Derek A. Nelson was sentenced to 19 years in prison a day after being convicted of running a $37 million Ponzi scheme through his Capital Mountain Holding Corp., state authorities said Tuesday. Investors delivered money in exchange promissory notes sold by Nelson, only to lose almost every cent, the Texas State Securities Board said. Nelson, of Oklahoma, was sentenced in Collin County court, the board said. "Nelson falsely represented to investors that their investments were secured by first liens on the properties he acquired....

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FINRA Charges Lawson Financial With Fraud For Bond Sales

By Matthew Perlman of law360.com Law360, New York (May 19, 2016, 7:46 PM ET) -- The Financial Industry Regulatory Authority said Thursday that it has slapped brokerage firm Lawson Financial Corp. and its chief executive with a complaint alleging they defrauded investors who purchased millions of dollars in municipal bonds by propping up the borrowers using funds from a deceased customer’s charitable trust. The complaint names the brokerage as well as its president and CEO, Robert Lawson, and his wife, Pamela Lawson, who serves as the firm’s chief operating officer. Regulators said the fraud involved a $10.5 million bond offering for an...

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Raymond James To Pay $17M For Money Laundering Flubs

By Jody Godoy of www.law360.com Law360, New York (May 18, 2016, 12:25 PM ET) -- Raymond James Financial Services Inc. and an affiliate agreed on Wednesday to pay $17 million in fines to the Financial Industry Regulatory Authority to settle allegations of widespread failure to institute adequate anti-money laundering controls. As a part of the settlement, Raymond James and Raymond James & Associates Inc. neither admitted nor denied FINRA's claims that rapid growth since 2006, particularly at RJA, had outstripped the firms' ability to detect and report money laundering. FINRA held RJA's former AML Compliance Officer, Linda L. Busby, personally responsible for...

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MetLife Pays Record $25M FINRA Fine Over Variable Annuities

By Carmen Germaine of law360.com Law360, New York (May 3, 2016, 10:49 AM ET) -- The Financial Industry Regulatory Authority announced Tuesday that MetLife Securities Inc. has agreed to pay a $20 million fine and $5 million in restitution for misleading customers over variable annuity replacements, the largest FINRA fine related to variable annuities to date. MetLife will pay a total of $25 million for misleading customers over variable annuity replacements. (Credit: AP) MetLife agreed to the sanctions without admitting or denying FINRA’s allegations that it omitted or misrepresented at least one material fact about customers’ existing variable annuities in nearly three-quarters of...

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Brokers Indicted For $131M ForceField Investor Fraud

By Kali Hays of law360.com Law360, New York (May 3, 2016, 4:45 PM ET) -- Several registered securities brokers were indicted Tuesday in New York federal court for fraud, kickbacks and other misconduct that allegedly cost investors of efficient lighting products maker ForceField Energy Inc. roughly $131 million. ForceField itself had been hit with a proposed securities class action about one year ago, with former company owner and Chairman Richard St. Julien arrested during that time for allegedly inflating ForceField's stock by paying for positive press, among other things. The brokers arrested Tuesday are being accused by the U.S. Department of Justice...

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You May Have Rights Under the Indiana Securities Act

In Indiana, companies and individuals offering and selling securities or investment advice must comply with the Indiana Securities Act, Indiana Code § 23-19-1 et seq. (the “Act”). The Indiana Securities Act, and the Indiana case law interpreting the Act, allows private litigants – typically the purchasers of securities or investment advice – to sue for damages. These damages include, but are not limited to, a return of the purchase price, interest at the rate of eight percent per year on the amount of the purchase price, attorney’s fees, and other litigation expenses. Claims under the Indiana Securities Act are typically based...

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Puerto Rican Bond Losses Result In UBS Paying For Damages

The Financial Industry Regulation Authority Inc has ordered that the UBS Group must pay more than $470,000 to three investors who claimed damages, due their accounts being over saturated with Puerto Rico bonds that plummeted in value. While filing claims in October of 2014, Carlos Merced, Ramon Velez Garcia, and Obdulio Ramos sought as much as $570,243 in damages, alleging negligence and fraud. UBS spokesman Gregg Rosenberg stated, “Although the arbitrators awarded less than the full damages the claimants requested, UBS is disappointed with the decision to award any damages, with which we respectfully disagree.” How The Damages Came About The Swiss bank’s...

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$2.7 Million Dollar Ponzi Scheme Results in Ramifications

Two brothers have been charged by the Securities and Exchange Commission for operating a $2.7 million ponzi scheme, by targeting elderly investors. Daniel Rivera, a New York resident, promised investors they would profit in a Pennsylvania real-estate venture named Robbins Lane. He recommended investors sell their retirement assets, enabling them to invest in the venture, which had no operations. To make the ponzi scheme more sophisticated, Rivera created a Robbins Lane website and a brochure advertising featuring an offer that gave “the senior investor a guaranteed monthly income.” In return, Rivera used the funds for his personal expenses. He purchased sporting...

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Four Charged in Fraud Scheme That Targeted The Elderly

A “free dinner” investment seminar ended in a fraud scheme that targeted elderly people, according to the SEC. Philadelphia residents John D. Ellis Jr. and Joseph Andrew Paul fabricated their respected track record of their investment firm, Paul-Ellis Investment Associates. The two recruited James S. Quay and Donald H. Ellison to help lure potential victims with promises of lofty returns. Approximately $1.3 million was raised from investors for Paul-Ellis Investment Associates from July 2011 through February 2012. The firm that Quay and Ellison founded, Aptus Planning LLC, located in Tampa, Fl, assisted in the fraud. Their alleged expertise was financial planning...

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Improper Trading Leads to Finra Charges

Finra has charged former broker David Randall Lockey with profiting from improper trading of client accounts for about two years. According to the Finra complaint, Mr. Lockey had engaged in unsuitable short-term trading and switching mutual funds and unit investment trust involving four accounts from May 2012 to March 2014. Lockey was associated with SWS Financial Services. Effects of Unsuitable Trading and How Starr Austen Can Help Mr. Lockey’s activities resulted in his own personal gain, to the tune of $75,730. Three of his four clients accrued a combined loss of $15,699. The fourth client, a retired engineer, benefited from a small...

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