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Prepare for the Unexpected: Your Succession Planning Portfolio

You may dream of someday passing down your family farm and your legacy to the next generation, but are you taking the necessary steps to prepare for that handoff? When it comes to successful succession planning, you do need more than a will – there are other important documents you must consider and open, ongoing communication is a must. According to attorney Polly Dobbs, "This process doesn’t have to be overwhelming. Farmers should begin by asking themselves: ‘What if I get hit by a bus?’ Then draft your succession plan like that life­-changing event is going to happen tomorrow. The hard work...

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SEC Amasses Record Enforcement Actions in 2014

With a record number of actions taken and fines levied, the Securities and Exchange Commission (SEC) experienced its most prolific year for enforcement in 2014, thanks to new investigative methods and innovative technology. According to the SEC’s preliminary figures, the agency filed 755 enforcement actions and obtained orders totaling $4.16 billion in disgorgement and penalties in fiscal 2014, which ended Sept. 30. In 2012, 686 actions and $3.4 billion were recorded, and 734 actions taken. SEC Chairman Mary Jo White said that aggressive enforcement against wrongdoers who harm investors and threaten our financial markets remains a top priority of the SEC. She...

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Former Wells Officer Charged and Fired for Covering Up Insider Trading

The Securities and Exchange Commission (SEC) recently charged Judy Wolf, a former compliance officer at Wells Fargo Advisors, for improperly altering a document. The SEC alleges that Wolf altered a document before it was provided to the SEC during its investigation into a former broker’s inside trading. Wells broker, Waldyr Da Silva Prado Neto, allegedly operated a scheme that made more than $2 million from insider trades in Burger King Holdings Inc. stock ahead of an acquisition announcement in Sept., 2010. Wolf was responsible for identifying potentially suspicious trading activity at Wells Fargo Advisors. According to the SEC, she closed the report...

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Former Raymond James Adviser Busted for Stealing $1 Million

An independent contractor with Raymond James Financial Services, Jo Ellen Fisher, has been barred from serving as an investment adviser after allegedly stealing $924,750 from a 95-year-old client to fund personal expenses. In a settlement posted on its website, the Financial Industry Regulatory Authority, Inc. (FINRA), which barred Ms. Fisher, said the illegal transfer of funds took place between July and December of last year. Without her client’s authorization, she transferred securities and funds into a brokerage account under the name of her daughter. What did Ms. Fisher do with the money? According to FINRA, she bought a 2014 Ford Explorer, three...

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SWS Charged with Improper Supervision of VA Transactions

Allowing numerous variable annuity (VA) applications to proceed without being reviewed by a supervisor led the Financial Industry Regulatory Authority Inc., (FINRA) to file charges recently against SWS Financial Services Inc. FINRA claims sales of these annuities comprised 16 to 20 percent of SWS' total revenue from September 2009 to May 2011 when the rule violations occurred. The five charges facing SWS include allegations of: • Inadequate supervisory systems and written supervisory procedures to supervise VA business, • Inadequate supervisory reviews of VA deals, • Failure to have registered principal review of VAs before submitting the application to the insurer, • Failure to have surveillance procedures to detect inappropriate VA exchanges,...

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Axa Broker Charged with Running Ponzi Scheme

Dennis Wright, a former broker at Axa Advisors in Lewistown, Pa, has been charged by the Securities and Exchange Commission (SEC) with running a Ponzi scheme that bilked customers of $1.5 million. In the 14-year-old scheme, which ran between 1998 and 2012, Wright allegedly lured about 28 customers -- including childhood friends and inexperienced investors -- to withdraw funds from Axa variable annuity accounts. Wright promised to transfer the money to an Axa mutual fund managed account with higher returns than the annuities. But Wright deposited the funds into a bank account he controlled and used to pay personal expenses and reimburse customers to whom he owed money. The...

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Longer Prison Terms for Brokers Charged with Investment Fraud

In 2013, brokers charged with investment fraud were sentenced to a 33 percent longer jail sentence than in the previous year, according to the North American Securities Administrators Association (NASAA). William Beatty, NASAA president and director of the Washington Securities Division, attributes the stiffer punishment to the heinousness nature of the crimes. Of the 4,882 investigations state regulators conducted last year, 2,184 led to enforcement actions, which resulted in 1,816 years of jail time for criminal defendants. Last year, the probation time ordered for criminal defendants increased to 679 years, up 96 percent from 2012. Also, criminal defendants in investment fraud cases were sentenced to an average of 5.5...

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Indianapolis Adviser Gets 10-Year Sentence

Kevin James, a former Indianapolis financial adviser, was sentenced by a federal judge to 10 years in prison and ordered to pay more than $1.3 million in restitution, after James pleaded guilty to stealing $1.4 million from 30 investors. In April, James was charged with securities fraud, mail fraud and money laundering. For 30 years, James worked as an insurance agent and financial adviser. He sold annuities and promised to reinvest current annuities for his insurance clients through a fictitious fund called the Financial Security Program. But James used the money for personal debt payments, Indianapolis Colts tickets and country club memberships. In a...

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SEC Charges Barclays $15 Million for Compliance Failures

The Securities and Exchange Commission (SEC) recently imposed a $15 million fine on Barclays Capital Inc. to settle charges that it failed to ensure proper compliance with its own rules and securities laws following Barclays’ acquisition of Lehman Brothers' advisory division in 2008. The Lehman purchase resulted in the creation of Barclays Wealth and Investment Management Americas. As of March 2014, the firm had about 260 financial advisers and $13 billion in assets under management. In a release announcing the charges, the SEC said that Barclays failed to oversee the growth of its advisory unit following the merger. Barclays Capital previously operated primarily as a broker-dealer. The SEC claims that...

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Settlement Close in Indiana State Fair Stage Collapse Case

A settlement appears to be imminent between the two parties involved in the case arising from the collapse of the stage right before a concert at the Indiana State Fair in 2011. The accident killed seven people, injured more than 40 and led to new regulations on the erection of riggings at outdoor events. The Defendants, Live Nation Worldwide, Dave Lucas Entertainment, Mid­America Sound, Lucky Star and most of the other defendants struck an initial deal after meeting May 5 and 6 with mediator John Van Winkle. Van Winkle cited the progress made toward a resolution in a recently filed report to Marion Superior Court Judge, Theodore...

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