FINRA Enforcement Actions 2012

Carla Norah Amieiro – Boca Raton, Florida, Securities Fraud and Misrepresentation FINRA, AAA and JAMS Arbitration Attorney

Published on: October 21, 2012 | By Russell L. Forkey, P.A.

Carla Norah Amieiro:

The Financial Industry Regulatory Authority, Inc. (FINRA) is a self-regulatory authority assigned the responsibility, by the Securities and Exchange Commission, to license, regulate and discipline securities broker/dealers and their employees, including account executives. In the event that FINRA elects to institute and enforcement action, firms and licensed individuals have the responsibility to reflect such action of their U-4 and/or U-5 filings, which can be viewed on the FINRA website under the broker-check section of the site or by viewing the monthly disciplinary information also provided on the FINRA site.

The monthly disciplinary information is referenced on the site generally in alphabetical order. This post relates to the following company or individual. If the reader would like to review the entire FINRA release or the broker-check information, you can follow these highlighted links:

Stone & Youngberg, LLC. – Florida FINRA, AAA, and JAMS Arbitration Attorney

Published on: October 21, 2012 | By Russell L. Forkey, P.A.

The Financial Industry Regulatory Authority, Inc. (FINRA) is a self-regulatory authority assigned the responsibility, by the Securities and Exchange Commission, to license, regulate and discipline securities broker/dealers and their employees, including account executives. In the event that FINRA elects to institute and enforcement action, firms and licensed individuals have the responsibility to reflect such action of their U-4 and/or U-5 filings, which can be viewed on the FINRA website under the broker-check section of the site or by viewing the monthly disciplinary information also provided on the FINRA site.

The monthly disciplinary information is referenced on the site generally in alphabetical order. This post relates to the following company or individual. If the reader would like to review the entire FINRA release or the broker-check information, you can follow these highlighted links:

April 2012 Disciplinary and Other FINRA Actions

Headwaters, BD, LLC., Paul Edward Jackson, Roberta Ann Laraway and Philip Williams Seefried, Jr. – Florida FINRA, AAA JAMS Arbitration Attorney

Published on: October 21, 2012 | By Russell L. Forkey, P.A.

The Financial Industry Regulatory Authority, Inc. (FINRA) is a self-regulatory authority assigned the responsibility, by the Securities and Exchange Commission, to license, regulate and discipline securities broker/dealers and their employees, including account executives. In the event that FINRA elects to institute and enforcement action, firms and licensed individuals have the responsibility to reflect such action of their U-4 and/or U-5 filings, which can be viewed on the FINRA website under the broker-check section of the site or by viewing the monthly disciplinary information also provided on the FINRA site.

The monthly disciplinary information is referenced on the site generally in alphabetical order. This post relates to the following company or individual. If the reader would like to review the entire FINRA release or the broker-check information, you can follow these highlighted links:

April 2012 Disciplinary and Other FINRA Actions

Cantone Research, Inc. (Tinton Falls, New Jersey) and Christine L. Cantone (Registered Principal, Thompson PA) – Florida FINRA Arbitration Attorney

Published on: September 15, 2012 | By Russell L. Forkey, P.A.

Cantone Research, Inc. and Christine L. Cantone:

The Financial Industry Regulatory Authority, Inc. (FINRA) is a self-regulatory authority assigned the responsibility, by the Securities and Exchange Commission, to license, regulate and discipline securities broker/dealers and their employees, including account executives. In the event that FINRA elects to institute and enforcement action, firms and licensed individuals have the responsibility to reflect such action of their U-4 and/or U-5 filings, which can be viewed on the FINRA website under the broker-check section of the site or by viewing the monthly disciplinary information also provided on the FINRA site.

The monthly disciplinary information is referenced on the site generally in alphabetical order. This post relates to the following company or individual. If the reader would like to review the entire FINRA release or the broker-check information, you can follow these highlighted links:

Synergy Investment Group (CRD# 46035, Charlotte, North Carolina), Thurman Ray Crawford (CRD# 56786, Registered Principal, Beaumont, Texas) and Jeffrey Dean Jones (CRD# 4188324, Registered Principal, Concord, North Carolina)

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

Private Placement and Direct Investment Fraud and Misrepresentation FINRA Arbitration and Litigation Lawyer, Russell L. Forkey, Esq.

February, 2012:

Synergy Investment Group, LLC (CRD #46035, Charlotte, North Carolina), Thurman Ray Crawford (CRD #56786, Registered Principal, Beaumont, Texas), and Jeffrey Dean Jones (CRD #4188324, Registered Principal, Concord, North Carolina) submitted an Offer of settlement in which the firm was censured and fined $20,000. Crawford was fined $10,000 and suspended from association with any FINRA member in any capacity for 60 days. Jones was fined $10,000 and suspended from association with any FINRA member in any principal capacity for three months. The level of sanctions takes into account $148,750 in restitution payments the firm and Crawford each made to the customers. The firm and Crawford have provided proof of restitution to FINRA. Without admitting or denying the allegations, the firm, Crawford and Jones consented to the described sanctions and to the entry of findings that the firm, through Jones, its director of compliance, failed to conduct reasonable due diligence regarding securities an entity issued. The findings stated that in order to obtain the firm’s approval for his intended sales of an offering, Crawford made negligent misrepresentations and/or omissions of material fact in connection with the sale of private placements to customers. The findings also stated that contemporaneously with the firm’s attempt to complete due diligence of a private placement as a new product, Crawford was negotiating with the firm for employment and omitted to disclose to anyone at the firm about the private placement delays in payment. The findings also included that Crawford knew, or should have known, that his firm had requested the private placement memorandum (PPM) for the offering in order to determine whether to approve his employment by the firm and his sale of the offering.

Finance 500, Inc. (CRD# 12981, Irvine California), Paul John Savage (CRD# 1722830, Registered Representative, Coto De Caza, California) and Thomas John Harm (CRD# 2093335, Registered Representative, Ladera Ranch, California)

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

Private Placement Fraud and Misrepresentation FINRA Arbitration and Litigation Attorney, Russell L. Forkey, Esq.

February, 2012:

Finance 500, Inc. (CRD® #12981, Irvine, California), Paul John Savage (CRD #1722830, Registered Principal, Coto De Caza, California) and Thomas John Harm (CRD #2093335, Registered Representative, Ladera Ranch, California), submitted a Letter of Acceptance, Waiver and Consent in which the firm was censured and fined $50,000. Savage was fined $10,000 and suspended from association with any FINRA® member in any principal capacity for 10 business days. Harm was fined $10,000 and suspended from association with any FINRA member in any capacity for one month. Without admitting or denying the findings, the firm, Savage and Harm consented to the described sanctions and to the entry of findings that the firm, through Harm, sold roughly 8.5 billion shares of unregistered securities, on a customer’s behalf, that were neither registered with the Securities and Exchange Commission (SEC) nor exempt from registration; the firm and Harm, therefore, participated in unregistered distributions of securities. Approximately one month after opening an account, the customer began bringing to the firm large blocks of stock of little known companies whose shares traded over the counter (OTCTM) and were quoted on Pink OTC Markets’ electronic quotation and trading system. All of the companies had recently issued shares in private offerings pursuant to Rule 504 of Regulation D. The customer immediately sold the shares after they had been deposited. Thereafter, the customer typically deposited another block of shares from the same issuer and the shares would again be immediately sold. During the succeeding 15 months, this pattern was repeated multiple times with the shares of several companies. The net liquidation proceeds amounted to approximately $1.2 million.

Scottsdale Capital Advisors Corp (CRD #118786, Scottsdale, Arizona) and Justine Hurry (CRD #2765969, Registered Principal, Paradise Valley, Arizona)

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

Sale of Unregistered Securities FINRA Arbitration and Litigation Attorney, Russell L. Forkey, Esq.

January, 2012:

Scottsdale Capital Advisors Corp (CRD #118786, Scottsdale, Arizona) and Justine Hurry (CRD #2765969, Registered Principal, Paradise Valley, Arizona) submitted an Offer of Settlement in which the firm was censured and fined $125,000, which includes the disgorgement of $18,000 in commissions earned in connection with violative sales of unregistered securities. Hurry was fined $7,500 and suspended from association with any FINRA member in any principal capacity, other than the capacity of Financial and Operations Principal (FINOP), for 40 business days. Without admitting or denying the allegations, the firm and Hurry consented to the described sanctions and to the entry of findings that the firm, acting through Hurry, failed to implement its anti-money laundering (AML) procedures, as it did not adequately monitor for and/or investigate facts and circumstances present in certain customer accounts that constituted “red flags” in its written AML compliance program. The findings stated that neither Hurry, nor anyone else at her firm, took steps to monitor for disciplinary background or multiple account red flags or for transactions triggering the journal transfer, penny stock or wire transfer red flags.

Robert John Clark (CRD# 47828, Vista, California)

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

Private Placement, Direct Investment and Selling Away, Fraud, Misrepresentation and Mismanagement FINRA Arbitration and Litigation Attorney, Russell L. Forkey, Esq.

February, 2012:

Robert John Clark (CRD #47828, Registered Representative, Vista, California) submitted a Letter of Acceptance, Waiver and Consent in which he was fined $25,000 and suspended from association with any FINRA member in any capacity for six months. The fine must be paid either immediately upon Clark’s reassociation with a FINRA member firm following his suspension, or prior to the filing of any application or request for relief from any statutory disqualification, whichever is earlier. Without admitting or denying the findings, Clark consented to the described sanctions and to the entry of findings that he recommended and sold an entity’s private placement offering to some customers for a total of $350,000. The findings stated that Clark became aware of the missed interest payments in the entity’s earlier offerings, and also saw the default notice from a bank, the trustee for one of the earlier offerings, but continued to sell the offering. The findings also stated that Clark did not view the offering as a speculative product due to favorable past performance of the company and the fact that it was paying a 9 percent return and believed that the offering was a low-risk, income-producing product. Clark did not conduct any analysis before selling the offering because he had sold earlier offerings of the entity and did not review the PPM because he was familiar with the earlier offering documents and assumed that this one was identical. The findings also included that unlike the earlier offerings, there were serious red flags as to the viability of the offering because the issuer was having trouble making both principal and interest payments to its investors in the earlier affiliated offerings. Clark became aware of the negative information concerning liquidity problems, delinquencies and defaults of earlier affiliated offerings that should have alerted him to the fact that the offering was also susceptible to delinquencies or default and therefore not suitable for his customers. FINRA found that Clark failed to conduct adequate due diligence and failed to have reasonable grounds to believe that the private placement offered by the entity pursuant to Regulation D was suitable for any customer in light of the fact that he was aware of the delinquencies and defaults of the entity’s earlier affiliated offerings.

Daniel Bull (CRD# 5495145, Registered Represented, Pittsbury, Pennsylvania)

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

Private Placement and Selling Away Fraud, Misrepresentation and Mismanagement FINRA Arbitration and Litigation Attorney, Russell L. Forkey, Esq.

February, 2012:

Daniel Bull (CRD #5495145, Registered Rep., Pittsburgh, Pa.) 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, Bull consented to the described sanction and to the entry of findings that he improperly used and converted over $491,000 from member firm customers and additional investors by making fraudulent misrepresentations to induce them to invest funds in a company that he and others established. The findings stated that Bull touted the success of his new company and provided potential investors with brochures, making numerous false statements and misrepresentations to gain the confidence of investors. Bull told investors that he was independently wealthy after selling several start-up companies for millions of dollars and had invented a strategy of buying and selling short-term municipal bonds to generate large returns. The findings also stated that Bull told the investors they were purchasing mutual funds and tax-free municipal bonds, but converted the funds for his own use, including repaying earlier investors. To conceal the conversion and fraud, Bull provided investors with fictitious account statements showing a return on their investments. (FINRA Case #2010022548401).

Kevin Seth Baltimore (CRD# 1863517, Registered Principal, Charleston, South Carolina)

Published on: July 6, 2012 | By Russell L. Forkey, P.A.

Private Placement and Direct Investment Fraud, Mismanagement and Misrepresentation FINRA Arbitration and Litigation Lawyer, Russell L. Forkey, Esq.

February, 2012:

Kevin Seth Baltimore (CRD #1863517, Registered Principal, Charleston, South Carolina) 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, Baltimore consented to the described sanction and to the entry of findings that he made fraudulent and unsuitable recommendations to customers, inducing them to invest in a commercial paper note which was a fraudulent private placement purportedly for accredited investors pursuant to Regulation D under the Securities Act of 1933; customers invested a total of $138,000 in the note. The findings stated that Baltimore also recommended the note investment to another client of one of his member firms. The findings also stated that Baltimore did not have reasonable grounds for believing the customers’ purchase of the note was suitable given their financial condition and that they were not accredited investors as defined in Rule 501 of Regulation D. The findings also included that Baltimore made materially misleading statements and omissions of fact when recommending the investment, including misrepresenting the type of business in which the issuer was engaged and misrepresenting the use of proceeds to be raised by the note, and failing to disclose that the issuer was a shell company with no significant business. FINRA found that Baltimore intentionally withheld from his firms that he was engaged in outside securities transactions and recommended the purchase of the note without the firms’ approval or knowledge, and participated in private securities transactions without providing written notice describing in detail the proposed transactions, his role therein and stating whether he had received, or would receive, selling compensation in connection with the transactions. (FINRA Case #2010023526301).