Tag: Investment Fraud

Australian Investment Fraud Syndicate

$30M Australian Investment Fraud Syndicate Busted

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Australian Investment Fraud Syndicate Discovered

An alleged $30 million Australian investment fraud syndicate was uncovered and shut down. After a two-year investigation, Australian police have shut down the Australian investment fraud syndicate that allegedly preyed on over 2,000 victims across Australia.

The three-year scam involved cold calling people with high-pressure sales tactics and offering them large returns on market investments. It was supported by websites containing fake information about the products and companies being sold.

Once victim’s money was obtained, the scammers laundered it through other victims, earmarking the money as the ‘returns’ on market investments, only to be reinvested in the scam.

The investigation was completed by the State Crime Command and culminated in raids on homes and businesses on the Gold Coast, in addition to one residence and business in Brisbane. Four men and one woman have been charged.

Have You Been a Victim of Investment Fraud?

If you are the victim of investment fraud or believe you have been scammed, you may have certain legal rights that require your immediate attention.

Call an Investment Fraud Attorney Today

If you are looking for an attorney to review your rights and options, the securities lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more than $100 million from banks and brokerages firms for their wrongful actions.

Contact an attorney at Dimond Kaplan & Rothstein, P.A. today to schedule an appointment or consultation to review your rights and options.

Former Philly Stockbroker Sentenced for Securities Fraud

Former Philly Stockbroker Sentenced for Securities Fraud

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Stockbroker Sentenced to Prison for Ponzi Scheme

A former Philadelphia-based stockbroker was sentenced to 6 ½ years in prison after defrauding investors of more than $3.2 million, according to a recent statement from the U.S. Attorney’s Office.

William Bucci pled guilty to securities fraud and other related charges. Among his victims were a Catholic priest and retired firefighter, whom he told that he was starting a business to import high-end olive oil and wine from Italy. In fact, Bucci never set up any business of the sort.

Stockbroker Scammed Friends and Classmates

In addition to his prison sentence, Bucci also was ordered to pay more than $3 million to his victims and the IRS. Bucci served as the president of the Order Sons of Italy from 2003 to 2007, the oldest and largest Italian-American fraternal organization in the U.S., through which he met several of his victims. In addition to those he met through the Order, he solicited old classmates and friends, promising to give them as much as 10 percent interest annually with a return the principal within a few years.

Instead of paying back friends and family, Bucci used investors’ money to support his lifestyle and pay off earlier victims, in Ponzi-scheme fashion. According to FINRA, Bucci was licensed at various brokerage firms between 2002 and 2012. His stockbroker’s license has since been revoked.

Call a Ponzi Scheme Attorney Today

If you invested with William Bucci or believe you have been the victim of a similar Ponzi scheme, you may have legal rights that require your attention and you should contact a qualified investment fraud attorney immediately.

Call a Ponzi Scheme Attorney Today

Contact an attorney at The Fraud Report’s partner law firm, Dimond Kaplan & Rothstein, P.A. today to schedule an appointment or consultation to review your rights and options.

With offices in Los Angeles, our securities lawyers throughout Santa Monica, Beverly Hills, and Hollywood they assist you with any securities issues that you may be facing.

Merrill Lynch Broker Fined by FINRA

Merrill Lynch Broker Guilty of Stealing $1 Million from Clients

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Merrill Lynch Broker Illegally Moves Money

A former Merrill Lynch broker pled guilty to stealing more than $1 million dollars from two of his clients by illegally withdrawing funds without permission.

Former Merrill Lynch adviser Alec Rivera pled guilty to committing wire fraud between October 2010 and September 2013, when he was a Merrill Lynch employee in Chicago.

Merrill Lynch Broker Alec Rivera Caught 

Rivera illegally withdrew funds from client accounts and then passed them through a Chicago-based chamber of commerce, before moving the money to his own account.

Rivera convinced colleagues at his brokerage firm to make over 100 cash transfers by telling them he had the authorization to do so. He then issued checks from the chamber of commerce to himself, claiming he had to make payments for various obligations, such as “IRS attorney payment.”

To hide his fraud, he had the clients’ real statements mailed to his address and created fake account statements that he provided to the two clients.

FINRA barred Rivera from acting as a securities broker in 2014 after his theft came to light and he failed to provide information related to the stolen funds.

Although he faces a possible 20-year prison sentence, he likely will receive between 3 ½ and 4 years under federal sentencing guidelines for cooperating.

Did You Invest with former Merrill Lynch Broker Alec Rivera? 

Whether you invested with Alec Rivera or someone like him, you may have certain rights that require your immediate attention.

Call a Stockbroker Fraud Attorney Today

If you are looking for an attorney to review your rights and options, the securities lawyers at Dimond Kaplan & Rothstein, P.A. have recovered over $100 million from banks and brokerages firms for their wrongful actions.

With offices in Los Angeles, they have helped stockbroker fraud victims throughout Santa Monica, Beverly Hills, and Hollywood.

Understanding Stockbroker Fraud

Part 1: Explaining & Understanding Stockbroker Fraud

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Protect Your Money by Understanding Stockbroker Fraud

In this multi-part series of blog posts, we are going to talk about how to protect your money from stockbroker fraud. Investing is a wonderful way to grow your money, but it also can expose you to abuse by people in positions of trust. One of the most important things you can do to protect yourself is to know as much as possible about where your money is going and making sure it is entrusted to the right person or brokerage firm.

In this first installment, we discuss understanding stockbroker fraud. Subsequent posts will discuss identifying stockbroker fraud and what to do if you become the unfortunate victim of stockbroker fraud.

What is Stockbroker Fraud?

First, it is important to understand what a stockbroker does and how you can become the victim of stockbroker fraud. A stockbroker (or “broker”) is a regulated professional who works with a brokerage firm, provides investment advice, and sells stocks or other securities in exchange for a commission or fee.

Stockbrokers are in a position of trust because the average investor relies on the broker’s knowledge to recommend suitable investments based on the investors’ stated investment objectives, risk tolerance, and investment needs.

Stockbroker fraud can come in many forms, ranging from churning, to misrepresentation or omission. Fraud can be difficult to spot, even to the trained eye. Churning, for example, is the buying and selling of securities for the primary purpose of generating commissions, regardless of whether the trades makes sense for the investor.

Types of Stockbroker Fraud

Other forms of stockbroker fraud can include but are not limited to:

  • Misrepresenting the nature or risks of an investment
  • Social Media Fraud
  • Microcap Fraud
  • Advance Fee Fraud
  • Foreign Currency Trading Fraud
  • High Yield Investment Programs

Stay tuned for Part 2 of our blog series, in which we will discuss what to do to help avoid becoming the victim of stockbroker fraud.

Call a Stockbroker Fraud Attorney Today

If you have suffered a loss because your broker or brokerage firm misrepresented or omitted crucial information about an investment, you may have legal rights that require your immediate attention. Such misrepresentations could be as basic at representing that a risky investment was safe and secure.

Contact an attorney today to schedule an appointment or consultation to review your rights and options.

Safety Technologies Executive to Pay $1.8 Million to SEC

Safety Technologies Executive to Pay $1.8 Million to SEC

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A Safety Technologies executive was indicted by the Securities & Exchange Commission (SEC) and ordered to pay $1.8 million in penalties and disgorgement to settle claims that he scammed investors – including women he met while online dating – by promising substantial returns on surgical glove technology.

SEC Settles with Thomas Connerton, Safety Technologies Executive

The SEC settled with Safety Technologies Executive Thomas Connerton and his company, Safety Technologies LLC. The settlement will end claims that Connerton persuaded investors to fork over $2.3 million by touting Safety Technologies’ purported technology. The Safety Technologies executive instead was spending the majority of investors’ money on his fiancée and himself.

The settlement requires Connerton to repay $1.7 million in disgorgement and a further $160,000 in civil penalties. The deal comes only a few weeks after Connerton and his fiancée, Jean Erickson, were criminally indicted for their activities in the same matter.

According to the complaint, the company was founded in 2006 to develop the ideas of a chemical engineer to create a puncture and cut-resistant surgical glove. He told investors that his product was both low-cost and revolutionary, claiming that his company was on the verge of signing several large-scale deals that would net the company as much as $1.7 billion over the next 10 years. He also claimed that he turned down an offer of $30 million for his company, which Connerton said was worth as much as $200 million.

Just over half of the money he raised came from women he met via online dating and their families or friends. Connerton circulated a fake private placement memorandum along with what he claimed was a law firm opinion letter concerning a patent application that stated the surgical glove technology was “novel and useful.”

SEC Claims Against Safety Technologies

The SEC stated that Connerton’s company Safety Technologies did not keep financial records other than tax returns, and investors were not allowed to keep a copy of the private placement memorandum. Further, Connerton spent only 7 percent of the money he had raised since 2009 on research and development. None of the money raised in 2016 was used for research and development for the company.

Have You Been a Victim of Securities Fraud?

Scammers like Thomas Connerton and his company are constantly coming up with new ways to defraud potential investors – including using online dating as a platform form which to raise investor money – to fleece unwitting investors.

Call a Securities Fraud Attorney Today

Contact an attorney today to schedule an appointment or consultation to review your rights and options. With offices in Los Angeles the attorneys at DKR have helped stockbroker fraud victims throughout Santa Monica, Beverly Hills, and Hollywood and recovered over $100 million from banks and brokerages firms for their wrongful actions.

Steps to Preventing Stockbroker Fraud

4 Steps to Preventing Stockbroker Fraud

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When you put money into an investment account, you want to make sure that it is safeguarded. These four steps to preventing stockbroker fraud can be taken in an effort to avoid stockbroker fraud and to make sure that you do not become the victim of an unscrupulous broker.

Investigate Your Broker’s Background

The Financial Industry Regulatory Authority (FINRA) has a handy BrokerCheck tool that allows you to check out your broker. You can find out if any complaints have been lodged, what the status or results are, and whether the broker has ever been fined or suspended. If your broker isn’t listed, this likely indicates that he or she is not properly licensed to sell securities and you should be avoid investing with that broker.

Review Account Information Very Carefully

When you open a brokerage account, forms are completed to document your risk tolerance, your investment objectives, and your net worth. Make sure that these forms are completed accurately, as your broker’s supervisor can use these documents as a benchmark against which to compare the investments and investment strategies that your sells to you. Even if your broker completes these forms for you, make sure that you review them for accuracy.

Review Your Statements and Address Suspicious Activity Immediately

Take the time to review your monthly account statements and any trade confirmations that you receive. If you notice something awry or if you do not understand any of the transactions, you should immediately contact your broker or brokerage firm. Any delay in doing so can lower your ability to bring a viable claim for investment fraud or stockbroker misconduct. If something looks wrong, address it immediately and make sure that you document your concerns in writing. Importantly, don’t simply rely on your broker if you have serious questions about your account. A broker who is committing wrongdoing likely would not admit that to you. Seek an independent review of your account from another broker or by an investment fraud lawyer.  

Close Your Account

If you believe you have been the victim of stockbroker misconduct or securities fraud, you should close your account immediately before anything else can happen. Find a new broker – and a securities fraud lawyer – and gather evidence of the potential misconduct.

More Information on Stockbroker Misconduct

For more information on unauthorized trading and common investor problems, you can also consult the FINRA website.

Call a Los Angeles Securities Fraud Attorney Today

While stockbroker misconduct cannot always be prevented, there are certain remedies for victims of securities fraud and misconduct, including filing a FINRA arbitration claim to recover your investment losses.

Contact an experienced Los Angeles securities fraud attorney today for a consultation to discuss your rights and options.

Paperwork stack concept showing how the referral scheme was hid from the client.

Attorney & Investment Adviser Charged in Referral Scheme

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An attorney and investment adviser have settled SEC charges over a referral scheme they created to disguise illicit fees. The referral scheme was created to disguise payments from an elderly widow’s account to the attorney for “legal services”, which were actually illicit fees for referring her accounts valued at more than $100 million to the investment adviser.

Attorney Peter Hershman of Connecticut and adviser John Rafal, who was once president and CEO of Essex Financial Services Inc., agreed to pay $90,000 and $575,000, respectively, for failing to disclose the lawyer’s improper fees, which was a violation of securities laws. Essex Financial Services also agreed to pay more than $180,000 in disgorgement to end claims against the brokerage firm related to Rafal’s actions. Hershman and Rafal had known each other for 25 years. In 2011, they agreed that Hershman would get an annual fee of $50,000 from the client’s advisory fees, though Hershman was not registered as an investment adviser.

Instead of telling their client about the referral fees, they disguised the payments through fake legal invoices to avoid detection. Essex employees discovered the scheme, after which Rafal was let go from the company and Hershman was asked to return the money paid to him. Instead, Rafal transferred an additional $24,570 from another account under his control.

Hershman told the SEC that he returned all the fees gained from the referral scheme back to Essex Financial, which was untrue, causing an investigation with the Massachusetts U.S. attorney’s office. Criminal charges against Hershman. When concerned Essex clients caught wind of rumors regarding Rafal’s actions, Rafal sent emails telling them he had been investigated and fully exonerated. Senior officials ordered him to retract the statements.

Call a Los Angeles Securities Fraud Attorney Today

Even though referral fees can be legal in certain circumstances, that is not always the case. If you believe you have been charged for services that cannot be explained or do not make sense to you, you may have certain legal rights that require your immediate attention.

Contact an experienced Los Angeles securities fraud attorneytoday for a consultation to discuss your rights and options.