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New Albany, Indiana Man Arrested on Multiple Counts of Securities Fraud and Theft

By Lindsey Holmes of tristatehomepage.com A New Albany man is in jail Thursday night after a 13-month investigation revealed he defrauded nearly $535,000 from numerous Dubois County Residents. In October 2015, a complaint was filed with the Indiana Secretary of State, Securities Division after a woman became concerned about the financial investments made on behalf of her mother. A criminal investigation was initiated by the Indiana State Police into the transactions by the woman’s financial advisor, 58 year old Stephen Recker, formerly of Jasper and currently of New Albany. Through the course of the investigation and as a result of the initial complaint, investigators...

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Whistleblower Tips, Recoveries on the Rise

By Michael Petro -- Buffalo Law Journal Statutory enactments by federal financial regulatory and various state enforcement agencies have made it easier, safer and financially enticing for employees and former employees to report corporate wrongdoing. According to the U.S. Securities and Exchange Committee, whistleblower tips have been on the increase over the past few years as legislation has provided whistleblowers incentives to report fraud to the Securities and Exchange Commission and Commodity Futures Trading Commission and give protection against retaliation and disclosure of their identities. The SEC, using the whistleblower program developed after the recession in 2010 under the Dodd-Frank Act, has...

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U.S. Takes Down Call-Center Financial Scam

Officials allege people impersonating IRS, immigration officials extracted more than $250 million from victims By Miriam Jordan of The Wall Street Journal Federal authorities said Thursday they had dismantled a massive call-center scheme perpetrated by individuals in the U.S. and India who bilked thousands of Americans out of hundreds of millions of dollars by posing as Internal Revenue Service and Department of Homeland Security officials. An 81-page indictment names 56 people in the U.S. and India and five call centers in Ahmedabad, India, allegedly involved in the fraud. They were charged in a Texas federal district court in Houston with crimes including impersonation...

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SEC sets record in enforcement actions against investment advisers

Uptick in adviser crackdown attributed to better data analytics and agency's new unit focused on asset management By Mark Schoeff Jr. of InvestmentNews.com The Securities and Exchange Commission filed a record number of enforcement cases against investment advisers and investment companies over the last year, the agency announced Tuesday. The SEC pursued 160 cases against advisers and firms, including 98 that were standalone — as opposed to follow-up actions or cases based on delinquent regulatory filings. Both numbers are records, the SEC said. The enforcement statistics for fiscal 2016 include the period from Oct. 1, 2015, through Sept. 30. The SEC also filed a record number of...

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State regulators reveal top enforcement targets and the price they pay

Agencies brought more cases against registered advisers than unregistered entities, and certain products featured in many of them By Mark Schoeff Jr. of investmentnews.com For the first time since they've been keeping enforcement statistics, state regulators last year brought more cases against registered financial advisers than against unregistered entities. In its 2015 enforcement report, the North American Securities Administrators Association said 812 registered advisers were named as respondents in cases, compared to 791 unregistered individuals and firms. Overall, state regulators opened 4,487 investigations last year and took 2,074 enforcement actions, according to the report, which was released at the NASAA annual conference in...

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Charlestown, Indiana man pleads guilty in securities fraud case

Richard Collins ordered to pay $250,000, sentenced to prison By Elizabeth Depompei of newsandtribune.com A Charlestown man was ordered to pay $250,000 in restitution after pleading guilty in a securities fraud case Monday. Richard Collins was president of R.C. Vision Quest in Jeffersonville, where he reportedly sold unregistered securities without being licensed to do so, a violation of the Indiana Uniform Securities Act. According to a July news release from the Indiana Secretary of State, Collins made cold calls to investors in North Carolina and Virginia and promised them high returns for investing. Collins reportedly advertised his business as being religion-based and all of...

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Indiana awards whistleblower $95K with more whistleblowers likely in financial advice sector

Earlier this month, Indiana announced its first whistleblower award, giving $95,000 to a former JP Morgan official who helped the state's regulators make an advice-related case against the firm that resulted in a $950,000 settlement. The informant showed how the firm failed to make proper disclosures to clients about proprietary funds in discretionary accounts. The whistleblower exposed JP Morgan for putting its interests before its clients. Federal and state securities regulators are relying more on firm insiders to uncover wrongdoing. As a result, the investment advice sector may find itself more vulnerable to whistleblowing. The Securities and Exchange Commission has been awarding...

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Day Traders Think They Can Win in Online Ponzi Schemes

Software makers and speculators help to keep $47 million a year flowing through a world of fraudulent investment schemes. By Eduardo Thomson and Janan Hanna of Bloomberg.com It’s the financial equivalent of a game of chicken: Put money into a likely Ponzi scheme, get paid for a while, and then try to get out before the collapse. That’s how some people seem to be using online “high-yield investment programs,” or HYIPs. The sites promise ludicrous returns—the equivalent of 1,000 percent or more annually—based on vague investment plans involving, say, bitcoin or currency trading. In reality, many are just passing money from new investors...

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ADM Accused in Trial of Directing Grain Sales Ponzi Scheme

By Bloomberg News A Missouri grain dealer who stole tens of millions of dollars from farmers may turn out to be their best ally as they try to recoup losses from corn giant Archer-Daniels-Midland Co. ADM began trial Tuesday in St. Louis with farmers claiming the woman couldn’t have ripped them off without help from the world’s biggest corn processor. From behind bars, where she is serving a nine-years sentence, the dealer’s testimony is set to bolster the farmers’ effort to get back more than just the mere fraction of their losses they’ve recovered from her. An unfavorable verdict for ADM could taint...

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Finra fines UBS $250,000 for overcharging mutual-fund customers

The firm allegedly failed to provide about 2,700 customers waivers tied to upfront sale charges InvestmentNews.com By Christine Idzelis A unit of UBS Group AG will pay a $250,000 fine to settle charges that it failed to waive certain fees for eligible mutual-fund customers, according to the Financial Industry Regulatory Authority Inc. The brokerage firm charged customers an excess of $277,636 to invest in mutual funds from September 2009 to June 2013, according to a settlement notice that Finra accepted Monday. The alleged supervisory failures were tied to so-called reinstatement rights that allow investors to avoid front-end sales charges. “We are pleased to have resolved...

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