Breach of Fiduciary Duty

Master Limited Partnership v. Public Limited Partnership – Florida Limited Partnership Federal, State and Arbitration Attorney

Published on: October 6, 2013 | By Russell L. Forkey, P.A.

Master Limited Partnership v. Public Limited Partnership – Florida Limited Partnership – Federal and State Litigation Attorney: Fraud in the Inducement, breach of the partnership agreement, mismanagement of the partnership, self-dealing and fraud in the operation of the partnership.

A limited partnership is a form of legal entity created under the law of a particular state. In Florida, the statute dealing with limited partnerships is Florida Statute Sections 620.1101 through 620.2205. To review a complete copy of this state, please follow the highlighted link:

http://www.leg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&URL=0600-0699/0620/0620PartIContentsIndex.html&StatuteYear=2013&Title=%2D%3E2013%2D%3EChapter%20620%2D%3EPart%20I

Margin – Leverage Abuse and Exploitation – South Florida Leverage and Margin Abuse, Exploitation and Manipulation FINRA Arbitration and Litigation Attorney

Published on: September 30, 2013 | By Russell L. Forkey, P.A.

Leverage Abuse, Exploitation and Manipulation – South Florida State and Federal Fraud, Misrepresentation and Breach of Contract Attorney:

Leverage may be used in a number of circumstances. In the business arena, three common uses, of leverage, relate to investments, financial leverage and operating leverage.

Investment Leverage (also known as margin) uses the equity in your brokerage account as a means of attempting to enhance the return on your equity without increasing your investment capital. Using margin, as part of your investment strategy, carries with it a number of risks, which you should fully understand before putting this strategy into effect. Both the Federal Reserve and brokerage firms have a number of rules that regulate the use of margin. Some key phrases are “initial margin,” “maintenance margin,” “house call,” and “Reg. T. Call.”

Unregistered Investment Advisor – Florida Unregistered Investment Advisor Fraud and Misrepresentation FINRA Arbitration and Litigation Attorney

Published on: September 28, 2013 | By Russell L. Forkey, P.A.

Securities and Exchange Commission v. Brian K. Velten, Civil Action No. 1:13-cv-23477 (S.D. Fla.)

The Securities Exchange Commission (“SEC”) recently filed a civil injunctive action in the United States District Court for the Southern District of Florida against Brian K. Velten alleging violations of the antifraud provisions of the federal securities laws in connection with his scheme to defraud at least three senior citizens who held accounts at Fidelity Brokerage Services, LLC (“Fidelity”), a broker-dealer registered with the SEC.

The SEC’s complaint alleges that, from no later than July 2009 through at least September 2012, Velten, an unregistered investment adviser, opened accounts for his clients at Fidelity and engaged in a scheme to defraud at least three of them by misappropriating approximately $171,000 from the clients’ accounts, making false claims about his ability to generate large profits trading stocks for the clients, and trading stocks on margin without client authorization.

Gignesh Movalia, Edwin V. Gaw and OM Investment Management, LLC. – Florida Investment Advisor and Hedge Fund Fraud, Misrepresentation and Mismanagement Litigation and Arbitration Attorney

Published on: September 28, 2013 | By Russell L. Forkey, P.A.

Securities and Exchange Commission v. OM Investment Management LLC, Gignesh Movalia, and Edwin V. Gaw, Civil Action No. 1:13-cv -23486-Martinez (S.D. Fla., filed September, 2013)

SEC Charges Tampa-Based Adviser with Fabricating Statements and Making Unauthorized and Undisclosed Investments

The Securities and Exchange Commission recently charged a formerly SEC-registered Tampa-based investment adviser, OM Investment Management LLC, its principal, Gignesh Movalia, and its director of investments, Edwin V. Gaw, with fraudulently raising money and making material misrepresentations and omissions relating to OM Global Investment Fund, LLC, an unregistered hedge fund.

Frank Dappah and Yatalie Capital Management – Florida Excessive Investment Advisory Fee Litigation and FINRA Arbitration Attorney

Published on: September 28, 2013 | By Russell L. Forkey, P.A.

Securities and Exchange Commission v. Frank Dappah and Yatalie Capital Management, et al., Civil Action No. 3:13-cv-00546 (W.D.N.C.)

SEC Charges Charlotte Investment Advisors with Excessive Fee Scheme

Recently, the Securities and Exchange Commission filed an action in federal court in the Western District of North Carolina, charging Frank Dappah of Charlotte, NC, and his firm, Yatalie Capital Management (a/k/a Yatalie Capital Management Co, Creato Funds L.P., a/k/a Yatalie Capital, Inc., a/k/a Creato Funds, L.P., a/k/a Yatalie Capital Management Co.), a sole proprietorship, with violations of the federal securities laws for charging grossly excessive fees to their advisory clients without authorization or notice and other violations. The Commission’s complaint seeks permanent injunctions, disgorgement of ill-gotten gains with prejudgment interest, civil penalties, and an asset freeze against the defendants.

Financial Abuse of Older Adults – Florida Elder Abuse and Financial Loss FINRA Arbitration and Litigation Attorney

Published on: September 27, 2013 | By Russell L. Forkey, P.A.

Florida Elder Abuse and Financial Loss FINRA Arbitration and Litigation Attorney:

Federal Regulators Issue Guidance on Reporting Financial Abuse of Older Adults

Seven federal regulatory agencies recently issued guidance to clarify that the privacy provisions of the Gramm-Leach-Bliley Act generally permit financial institutions to report suspected elder financial abuse to appropriate authorities.

No-Load Fund – Florida Mutual Fund Misrepresentation and Breach of Fiduciary Duty FINRA Arbitration and Litigation Attorney

Published on: September 22, 2013 | By Russell L. Forkey, P.A.

No-Load Mutual Fund – South Florida Mutual Fund Breach of Fiduciary Duty, Negligence and Breach of Contract FINRA Arbitration and Litigation Attorney:

A “No-Load” fund is a mutual fund offered by an open-end investment company that imposes on sales charge (load) on its shareholders. Investors buy shares in no-load funds directly from the fund companies, rather than through a broker, as is done in load funds. Many no-load fund families allow switching of assets between stock, bond, and money market funds. The net asset value, market price, and offer prices of this type of mutual fund are exactly the same, since there is no sales charge.

Please keep in mind that the above information is being provided for educational purposes only. It is not designed to be complete in all material respects. Thus, it should not be relied upon as legal or investment advice. If the reader has any questions concerning the contents of this post, you should contact a qualified professional.

Unit Investment Trust (UIT) – South Florida Investment Adviser Securities and Investment Fraud, Mismanagement and Breach of Fiduciary Duty FINRA Arbitration and Litigation Attorney

Published on: September 17, 2013 | By Russell L. Forkey, P.A.

In the Matter of Sarkauskas & Associates, Inc. and James M. Sarkauskas

Recently, the Securities and Exchange Commission issued a settled Order Instituting Administrative and Cease-and-Desist Proceedings, Pursuant to Section 15(b) of the Securities Exchange Act of 1934, Section 203(e), 203(f) and 203(k) of the Investment Advisers Act of 1940, and Section 9(b) of the Investment Company Act of 1940, Making Findings, and Imposing Remedial Sanctions and a Cease-and-Desist Order (Order) against Sarkauskas & Associates, Inc. (the Adviser) and James M. Sarkauskas (Sarkauskas).

The Order finds that the Adviser, a Wisconsin-based investment adviser, and its principal, Sarkauskas, violated Sections 206(1) and (2) of the Advisers Act when they purchased unit investment trust (UIT) units bearing transactional sales charges in their clients’ accounts without disclosing that identical no-load UIT units sold at net asset value with no transactional sales charges were available for purchase, and that the Adviser’s purchases of the units bearing transactional sales charges substantially increased the Respondents’ compensation, thereby creating a conflict of interest. The Order further finds that between August 2009 and August 2012, the Adviser, through Sarkauskas, collected $331,433.98 in such sales charges in addition to the Adviser’s asset management fees.

South Florida Money Manager Fraud, Mismanagement and Breach of Fiduciary Duty FINRA Arbitration and Litigation Attorney

Published on: September 17, 2013 | By Russell L. Forkey, P.A.

Securities and Exchange Commission Charges Purported Money Manager in New York Who Schemed Investors and Lied to Commission Examiners

The Securities and Exchange Commission (Commission) recently charged the owner of a New York-based investment advisory firm with defrauding investors while grossly exaggerating the amount of assets under his management.

The SEC alleges that Fredrick D. Scott of Brooklyn, N.Y., registered his firm ACI Capital Group as an investment adviser and then embarked on a series of fraudulent schemes targeting individual investors and small businesses. Scott repeatedly touted ACI’s registration under the securities laws and falsely claimed the firm’s assets under management to be as high as $3.7 billion to bolster his credibility when offering too-good-to-be-true investment opportunities. As Scott solicited funds from investors after promising them very high rates of return, he simply stole their money almost as soon as they deposited it with ACI. Scott paid no returns to investors and illegally used their money to fund such personal expenses as his children’s private school tuition, air travel and hotels, department store purchases, and several thousand dollars in dental bills.

Hedge Funds – Florida Hedge Fund Investment Loss and Mismanagement Litigation and Arbitration Attorney

Published on: August 30, 2013 | By Russell L. Forkey, P.A.

Hedge Funds – Investment Loss and Mismanagement Federal and State Litigation Attorney:

“Hedge fund” is a general, non-legal term used to describe private, unregistered investment pools that traditionally have been limited to sophisticated, wealthy investors. Hedge funds are not mutual funds and, as such, are not subject to the numerous regulations that apply to mutual funds for the protection of investors – including regulations requiring a certain degree of liquidity, regulations requiring that mutual fund shares be redeemable at any time, regulations protecting against conflicts of interest, regulations to assure fairness in the pricing of fund shares, disclosure regulations, regulations limiting the use of leverage, and more.

“Funds of hedge funds” are nvestment companies that invest in hedge funds. Some, but not all, register with the SEC and file semi-annual reports. They often have lower minimum investment thresholds than traditional, unregistered hedge funds and can sell their shares to a larger number of investors. Like hedge funds, funds of hedge funds are not mutual funds. Unlike open-end mutual funds, funds of hedge funds offer very limited rights of redemption. And, unlike ETFs, their shares are not typically listed on an exchange.