Breach of Fiduciary Duty

Limited Partnership – Florida Breach of Contract and Breach of Fiduciary Duty State and Federal Court Commercial and Business Litigation Attorney

Published on: May 19, 2013 | By Russell L. Forkey, P.A.

Limited Partnership Breach of Contract, Breach of Fiduciary Duty, Mismanagement and Misrepresentation Commercial and Business State and Federal Court Litigation Attorney:

A Limited Partnership is an organization made up of a General Partner, who manages the entity, and limited partners, who invest money but have limited liability, are who are not involved in the day-to-day management and operation of the venture. With certain exceptions, limited partners usually cannot lose more than their invested capital. Limited partnerships are engaged in business ventures such as real estate, oil and gas and equipment leasing.

Public limited partnerships are sold through brokerage firms by the use of written offering documents. Private limited partnerships can be offered through various means. Regardless, each offering method must comply with federal and state securities laws.

Stephen B. Blankenship and Deer Hill Financial Group, LLC. – Florida Securities Broker – Dealer Misappropriation FINRA Arbitration and Litigation Attorney

Published on: May 19, 2013 | By Russell L. Forkey, P.A.

Final Judgments Entered against Connecticut-Based Investment Adviser and His Firm Charged with Stealing Investor Funds

The Securities and Exchange Commission (“Commission”) recently announced that on May 16, 2013, the United States District Court for the District of Connecticut entered final judgments by consent in a previously filed enforcement action against Stephen B. Blankenship and his investment advisory firm, Deer Hill Financial Group, LLC. The judgments enjoin Blankenship and Deer Hill from future violations of the federal securities laws.

On September 13, 2012, the Commission filed an enforcement action charging Blankenship, then a resident of New Fairfield, Connecticut, and Deer Hill Financial Group, LLC, a Connecticut limited liability company under Blankenship’s control, with a scheme to defraud investors. The Commission’s Complaint alleged that, from at least 2002 through November 2011, Blankenship misappropriated at least $600,000 from at least 12 brokerage customers. The Court’s judgment enjoins Blankenship and Deer Hill from future violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and Section 17(a) of the Securities Act of 1933. The judgment also enjoins the defendants from future violations of Sections 206(1) and 206(2) of the Investment Advisers Act of 1940 and Section 15(a) of the Exchange Act.

Cherry-Picking or Illicit Stock Allocation – South Florida Securities Misrepresentation and Breach of Fiduciary Duty FINRA Arbitration, State and Federal Litigation Attorney

Published on: May 19, 2013 | By Russell L. Forkey, P.A.

Securities and Exchange Commission v. Charles J. Dushek, et al., Civil Action No. 13-cv-3669 (N.D. Ill., filed May 16, 2013)

SEC Charges Chicago-Area Father and Son Conducting Cherry-Picking Scheme At Investment Firm

The Securities and Exchange Commission (“Commission”) filed a civil injunctive complaint on May 16, 2013, in the United States District Court for the Northern District of Illinois relating to a fraudulent cherry-picking scheme conducted by Charles J. Dushek (Dushek Sr.) of Warrenville, Illinois and his son Charles S. Dushek (Dushek Jr.) of Wheaton, Illinois. The Commission charged Dushek Sr., Dushek Jr., and their Lisle, Illinois-based investment advisory firm, Capital Management Associates, Inc. (CMA), with securities fraud, among other violations of the securities laws, for defrauding CMA clients in a cherry picking scheme that garnered the Dusheks nearly $2 million in illicit profits.

Jeffrey Stebbins and Corbin Jones – Florida Stockbroker Fraud and Misrepresentation FINRA Arbitration and Litigation Attorney

Published on: May 1, 2013 | By Russell L. Forkey, P.A.

Securities and Exchange Commission v. Jeffrey Stebbins and Corbin Jones, Civil Action No. CV 13-755-PHX-SRB

SEC Charges Two Arizona-Based Brokers with Defrauding Investors in Tankless Water Heater Venture

The Securities and Exchange Commission recently filed a complaint in the United States District Court for the District of Arizona, charging two former brokers in Arizona with stealing investments in a project to develop tankless water heaters.

Linda Woolf, Hands On Capital, Inc. – South Florida Securities and Investment Fraud and Breach of Fiduciary Duty FINRA Arbitration and Litigation Attorney

Published on: April 21, 2013 | By Russell L. Forkey, P.A.

Securities and Exchange Commission v. Linda Woolf, Hands On Capital, Inc., et al., Civil Action No. 1:08cv235 (E.D.Va.)

Former “Teach Me to Trade” Saleswoman and Infomercial Personality Linda (Knudsen) Woolf Agrees to Settle Securities Fraud Charges and Pay a $225,000 Penalty

The Securities and Exchange Commission recently announced that the United States District Court for the Eastern District of Virginia entered settled final judgments against Linda (Knudsen) Woolf and Hands On Capital, Inc. Securities and Exchange Commission v. Linda Woolf, Hands On Capital, Inc., et al, Civil Action No. 1:08cv235 (E.D.Va. filed March 11, 2008). The final judgments resolve the Commission’s case against Woolf and Hands On Capital.

Should You Risk Your Home to Buy Securities or to Purchase Other Investments? South Florida Elder, Senior and Retirement Financial Abuse and Exploitation FINRA Arbitration and Litigation Attorney

Published on: December 11, 2011 | By Russell L. Forkey, P.A.

South Florida Senior, Elder and Retirement Financial Abuse and Exploitation FINRA Arbitration, Litigation and Probate Estate Attorney:

Should you risk your home to invest in stocks, bonds, mutual funds or other investments? In our opinion, the answer is no.

Over the years, in our representing investors, those individuals that have been impacted the most by losses suffered in the stock market or, for that matter in any other type of investments, are those that have borrowed money against their home and invested the proceeds, only to lose that money also.

Senior Investors and Senior Designations – South Florida Elder, Senior and Retirement Financial Abuse and Exploitation FINRA Arbitration and Litigation Attorney

Published on: November 18, 2011 | By Russell L. Forkey, P.A.

South Florida Senior, Elder and Retirement Financial Abuse and Exploitation FINRA Arbitration and Litigation Attorney:

The Financial Industry Regulatory Authority (FINRA) is a self-regulatory authority responsible for overseeing the practices of securities broker dealers. For several years, FINRA has focused on firms’ fair dealings with senior investors, as well as investors at or approaching retirement (hereinafter together referred to as senior investors).

In September 2007, FINRA issued Regulatory Notice 07-43, which highlighted certain issues that are common to many senior investors and reminded firms of their obligations in this area. In 2008 and 2010, FINRA joined with other regulators to issue findings and guidance on firms’ practices relative to senior investors. Most recently, in the 2011 Annual Regulatory and Examination Priorities Letter, FINRA reiterated that the protection of vulnerable customers, including senior investors, continues to be a high regulatory priority.

Investment Scams and some Tips on how to Spot them – South Florida Securities and Investment Fraud and Misrepresentation Litigation and Arbitration Attorney

Published on: October 12, 2011 | By Russell L. Forkey, P.A.

Investment Scams – South Florida Securities and Investment Fraud and Misrepresentation FINRA Arbitration and Litigation Attorney:

When it comes to making an intelligent investment decision, nothing is fool- proof. However, there are some basic sales tactics that should turn your “red light” on. Some of the most common include:

The “Phantom Riches” Tactic: Here the salesperson dangles the prospect of wealth, enticing you with something you want but can’t have. “These gas wells are guaranteed to produce $6,800 a month in income.”

Who Can You Trust? Elder, Senior and Retirement Financial Abuse and Exploitation FINRA Arbitration and Litigation Attorney

Published on: January 19, 2011 | By Russell L. Forkey, P.A.

South Florida Elder, Senior and Retirement Financial Abuse and Exploitation FINRA Arbitration and Litigation Attorney:

Normally, we provide information like this post on our main website. However, because of the contents of this post, we thought that it would constitute interesting reading for seniors, their care givers, personal representatives and trustees. This post reflects the extent that individuals will go to benefit themselves at the expense of elder or deceased persons.

Chad R. Duncan (CRD #4119031, Registered Principal, Hermitage, Pennsylvania, last registered with LPL Financial Corporation) 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, Duncan consented to the described sanctions and to the entry of findings that without permission or authority, he used $100,000 drawn from an elderly person’s bank account to pay his personal credit card expenses, which were related to costs associated with the construction of his home. The findings stated that when the executor of the deceased person’s estate became concerned about the withdrawals totaling $100,000, Duncan created fictitious cashier’s checks totaling $100,000 and payable to charities, falsely representing that the checks represented evidence of the payments made by the deceased and the beneficiaries of the payments. The findings also stated that the withdrawals were earlier used to purchase cashier’s checks payable to an international commercial bank to pay down Duncan’s credit card expenses. The findings also included that a bank compensated the customer for the wrongfully taken funds, and Duncan has reimbursed the bank approximately $91,484.75 and continues to make monthly payments to cover the amounts the bank paid to the customer. (FINRA Case #2009017755101)

High Pressure Sales of Annuities to Seniors and Others – Florida Variable and Fixed Annuity Fraud, Misrepresentation and Twisting FINRA Arbitration and Litigation Attorney

Published on: January 15, 2011 | By Russell L. Forkey, P.A.

South Florida Variable and Fixed Annuity Fraud, Misrepresentation, Breach of Fiduciary Duty and Twisting FINRA Arbitration and Litigation Attorney:

We recently were presented with the following factual situation. A single 82 year old, long retired woman received a “cold call” from a mortgage broker, who, after repeated telephone calls and visits to the woman’s home, convinced her to refinance her residence, She somehow got the woman to believe that it would be beneficial to pay off her $200,000 fixed rate, first mortgage, on her house that she had owned for many years, and to take out a new variable rate mortgage for almost $1,000,000 and put the difference in the bank for emergencies. If that was not enough, the 82 year old woman took the net proceeds to deposit into a bank account and the securities arm of the bank got a hold of her. Instead of telling the woman that it was a terrible idea to have taken out the new first mortgage, the securities arm of the bank sold the woman an annuity for $500,000, which started paying her monthly for 10 years. All of the payments that the woman got went to make the monthly mortgage payments. Obviously, the problem that this created for the woman was that after 10 years she would not be getting any more income from the annuity and the principal balance of the mortgage would be unchanged, thereby building into the transaction an automatic default in the mortgage. This is but one of many examples that could be given to show the extent to which some variable sellers will go to sell a product because of the large commission associate with the product.

While variable annuities can be appropriate as an investment under the right circumstances, as an investor, you should be aware of their restrictive features, understand that substantial taxes and charges may apply if you withdraw your money early, and guard against fear-inducing sales tactics.