SEC Bars Hyaline Capital Management Advisor

SEC Bars Hyaline Capital Management Advisor

The U.S. Securities and Exchange Commission (SEC) has barred New York-based Hyaline Capital Management advisor Justin D. Meadlin from the securities industry. The SEC alleges that Meadlin used false and misleading information to solicit investments for Hyaline Capital Management.

Advisor Uses False Information to Solicit Investors

According to the SEC, Meadlin claimed that Hyaline had $25 million under management and consistently touted positive performance to prospective investors and clients. The claims, delivered in emails and in subscription hedge fund databases, materially inflated the fund’s assets under management and cited favorable returns dating back to 2009 generated by a “proprietary” algorithm.

In a complaint filed in April, the SEC says that none of Meadlin’s statements were true and those who invested with the advisor did so based on fraudulent misrepresentations and omissions. There was no Hyaline fund and Meadlin had not acquired or created a “proprietary” algorithm.

Meadlin Ordered to Pay Penalty

The U.S. District Court for the Southern District of New York has ordered Meadlin to pay a civil penalty of $150,000 and disgorge $150,645.66 plus interest, totaling just over $300,000.

Are You a Victim of Securities Fraud?

If you lost money as a result of stockbroker misconduct or securities fraud, contact a qualified securities fraud attorney today.

Call a Securities Fraud Attorney Today

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

With offices in Los AngelesNew YorkWest Palm Beach and Miami, our securities fraud attorneys represent clients nationwide and can help you recover your investment losses.

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

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Blazer Capital Management Advisor Pays Settlement

Blazer Capital Management Advisor Pays Settlement

A financial advisor and the founder of Blazer Capital Management will pay more than $1.9 million to resolve allegations that he defrauded clients, including some professional athletes. The allegations, brought by the U.S. Securities and Exchange Commission (SEC), claim the advisor used $2.35 million dollars of client money without permission, and lied to agency investigators about it.

The claims state that Pittsburgh-based adviser Louis Martin Blazer III used funds from the accounts of several clients to make investments in a pair of movies and other ventures. To conceal his actions, he diverted client’s funds to other accounts and falsified documents.

The SEC accused Blazer of taking a total of $2.35 million from five clients without authorization, using $790,000 of these funds to pay others in the group in a “Ponzi-like” scheme.

Advisor to Pay $1.9M for Defrauding Athletes

Judge J. Paul Oetken signed off on a final judgment to end the claims brought by the SEC. Under the deal, Blazer agreed to settle without admitting or denying the charges. He will pay $1,558,647 in disgorgement, $220,051.57 in prejudgment interest, and a $150,000 civil penalty for a total settlement of $1,928,698.57.

The final judgment comes approximately 15 months after the SEC filed a complaint against Blazer in the Southern District of New York and simultaneously announced a partial settlement related to the alleged scheme.

Are You a Victim of Investment Fraud?

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

Call an Investment Fraud Attorney Today

If you are looking for an investment fraud attorney to review your rights and options, the investment fraud lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more than $100 million from banks and brokerage firms for their wrongful actions.
With offices in Los AngelesNew YorkWest Palm Beach and Miami, our investment fraud attorneys represent clients nationwide and may be able to help you recover your investment losses.

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

 

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Athlete Overcharged $1.2M by Investment Advisor

Athlete Overcharged $1.2M by Investment Advisor

The U.S. Securities and Exchange Commission (SEC) has filed a lawsuit against an investment advisor in California federal court on accusations of deceiving a professional athlete client and his wife in relation to inflated management fees of more than $1 million.

The SEC claims that the advisor, Jeremy Drake, charged the unnamed athlete and his wife 1 percent in management fees but told the couple the fee was between 0.15 percent and 0.2 percent. The fee difference resulted in a payment to Drake of $1.2 million more than what he represented to his client.

In order to conceal the discrepancies, Drake falsified documents and created a fake persona to supply false evidence to corroborate his claims. When Drake was confronted by the athlete’s wife, he told her that reporting the issue to the brokerage firm would create bad publicity for the couple. The athlete’s wife refused and came forward resulting in the termination of Drake.

SEC Seeks Disgorgement of Funds

The SEC claims for violating the Investment Advisers Act and seeking disgorgement of all the funds Drake earned from his alleged misconduct. Of the $1.5 million Drake received, the SEC alleges that $900,000 came from incentive-based compensation related to the fees paid by his clients.

Are You a Victim of Broker Misconduct?

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

Call an Investment Fraud Attorney Today

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

With offices in Los AngelesNew YorkWest Palm Beach and Miami, our investment fraud attorneys represent clients nationwide and may be able to help you recover your investment losses.

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

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Federal Regulators Focus on Bad Actor Brokers

Federal Regulators Focus on Bad Actor Brokers

U.S. Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA) officials have announced that they will focus their attention on broker-dealers in high-risk areas. Both securities regulators hope to crack down on bad actor brokers – brokers who don’t act in the investor’s best interest – and are encouraging firms to help, in hopes of protecting investors.

FINRA President and CEO, Robert Cook, said of FINRA’s programs in a speech recently: “One of their most important purposes is to protect investors from bad actors: those who seek to evade regulatory requirements and harm investors for their own personal gain.”

Three Ways to Regulate Bad Actor Brokers

Cook highlighted three ways that FINRA is enforcing its regulations to protect investors from bad actor brokers, announcing that increased regulation will be done through more exams and enforcement.

Licensing and Registration

To qualify as a broker, a person must pass a series of exams that test knowledge regarding the operation of the markets, the securities industry, and its regulation. The exams are followed by a series of continuing education programs and further exams throughout the broker’s career.

In addition to passing a series of examinations, a broker must also be associated with a broker-dealer firm, which is responsible for supervising the broker. Brokerage firms also must be registered with the SEC and approved by FINRA to operate. Brokerage firms are subject to scrutiny, including a vetting process, operational requirements, and required standards for capital and supervision.

Monitoring and Examinations

For brokers and brokerage firms that meet the regulatory standards and qualifications, FINRA assigns a regulatory coordinator who oversees the firm’s business activities. Brokerage firms are assessed regularly based on core business areas, such as customer dealings, financial integrity, and operations. Non-routine examinations are triggered by customer complaints about bad actor brokers – an area where FINRA is dedicating more resources for regulation.

Discipline and Restitution

In addition to regulatory systems, FINRA has increased surveillance efforts designed to fight against potential fraud or market manipulation. Within FINRA, The Office of Fraud Detection and Market Intelligence (OFDMI) is a specialized central repository that works to gather and evaluate information about misconduct at both the broker and broker-dealer level.

In cases where actions of a firm or an individual pose harm to investors, FINRA intervenes in multiple ways – from requiring brokers to retake examinations to reporting misconduct to law enforcement agencies.

In 2016 alone, 1,434 disciplinary actions were filed against registered individual brokers and firms. And the agency has ordered some $124 million in restitution to investors who have been victims of bad actor brokers and their brokerage firms. Of course, such orders do not necessarily mean that defrauded investors are paid that money. Brokers and brokerage firms only can pay that money if they are able to do so. Many the brokers cannot make the payments and many of the brokerage firms have gone out of business and cannot make any payments to investors.

Bad Actor Broker Regulation In Question

A core issue is whether U.S. regulators and the securities industry are doing enough to protect investors. As seasoned investment fraud and stockbroker misconduct lawyers, Dimond Kaplan & Rothstein’s attorneys see many, many cases of investor abuse, so we firmly believe that regulators are not doing enough to protect investors. In fact, a recent study shows that the percentage of brokers engaged in misconduct is much higher than reported by FINRA. Perhaps the new focus by the agencies will help eliminate some of the misconduct and keep more investors safe.

Did You Lose Money with a Bad Actor Broker?

If you have been a victim of a bad actor broker or are suspicious that your broker is not acting in your best interest, 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 investment fraud lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more than $100 million from banks and brokerages firms for their wrongful actions.

With offices in Los AngelesNew YorkWest Palm Beach and Miami, our investment fraud attorneys represent clients nationwide and may be able to help you recover your investment losses.

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

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Securities Fraud Municipal Bond Case

Town Supervisor Convicted in Securities Fraud Municipal Bond Case

First Conviction in Securities Fraud Municipal Bond Case 

A Ramapo, New Jersey town supervisor has been convicted in a securities fraud municipal bond case related to the financing of a controversial stadium. The conviction marks the first conviction for securities fraud in connection with municipal bonds.

Ramapo Town Supervisor Christopher St. Lawrence lied to investigators about the town’s finances, covering the town’s problems.  The fraud at issue related to the issuance of $25 million in municipal bonds to pay for construction of a minor league baseball stadium. The stadium cost $58 million.

A jury in a White Plains federal court convicted the 65-year-old supervisor on 20 counts of conspiracy, securities fraud and wire fraud. He was acquitted of one count each of securities fraud and wire fraud.

Call a Securities Fraud Attorney Today

If you are looking for a securities fraud 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 a securities fraud attorney at Dimond Kaplan & Rothstein, P.A. today to schedule an appointment or consultation to review your rights and options.

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JSG Capital Charged in $10M Ponzi Scheme

Two California men have been charged with defrauding $10 million from retail investors by promising exclusive investment opportunities “previously only available to the one-percent.”

The SEC filed a complaint against Jaswant “Jason” Gill, founder and CEO of JSG Capital Investments, and Javier Rios. Both men have been accused of pocketing at least $2.8 million in investor funds, using at least some of investors’ money to pay for meals at high-end restaurants, trips to Las Vegas, and tickets to professional sporting events.

JSG Capital billed itself as a “boutique advisory firm” with offices in Los Angeles, San Francisco, and New York. Investors were told that they could secure annual returns of up to 60% by investing in tantalizing pre-IPO stocks including Airbnb, Uber, and Alibaba.

The JSG Capital website enticed investors by promising access to alternative investment strategies previously reserved for the ultra-rich, and touting their Wall Street experience – Gill’s biography claimed he had been a managing director at Morgan Stanley.

According to the SEC, Morgan Stanley has never employed Gill and Rios has a background in the food service industry, not financial services.

Rios and Gill also have been charged with criminal wire fraud in addition to operating a Ponzi scheme. Less than 1% of investor funds were actually transferred to JSG trading accounts.

Call a Los Angeles Securities Fraud Attorney Today

If you invested with Gill, Rios, or JSG Capital, you may have certain legal rights that require your immediate attention.

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

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