NYC Financial Adviser Pleads to $1.6M Trust Theft

NYC Financial Adviser Pleads to $1.6M Trust Theft

The Manhattan district attorney announced recently that a former New York-based financial adviser will spend more than two years in prison after admitting that he committed trust theft.  The adviser, Brian Keenan, formerly of Train, Babcock Advisors LLC, took $1.6 million out of three trusts that he oversaw.

From 2007 and 2012, Keenan used a checking account set up in his own name and the name of one of the trust beneficiaries to withdraw funds from the trusts for personal use. The beneficiary had not been given access to the account.

Civil Suits Filed in California

Keenan’s client Delia Foster had set up trusts for her nephew and his two children, relying on Keenan and his firm to manage the assets. According to civil suits filed in California state court, Keenan had been managing Foster’s assets since the 1990s.

In 2013, when Foster discovered the assets had been removed from the trust accounts, she sued both Keenan and Train, Babcock Advisors.

Adviser Pleads Guilty

Keenan, 60, pled guilty in New York Supreme Court to one count of grand larceny for diverting the funds from trusts set up by of one of his clients. Keenan will receive a sentence of two years and four months to seven years in exchange for his plea.

Sentencing for the former adviser is scheduled for December 2017.

Have You Lost Money to Stockbroker Misconduct?

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

Call an Investment Fraud Attorney Today

If you are looking for an securities 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 securities fraud attorneys represent clients nationwide and may be able to help you recover your investment losses.

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


Merrill Lynch Broker Fined by FINRA

Merrill Lynch Broker Guilty of Stealing $1 Million from Clients

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.

Protecting Your Money by Responding to Stockbroker Fraud

Part 3: Reacting and Responding to Stockbroker Fraud

Protecting Your Money by Responding to Stockbroker Fraud 

In Part 1 of this series, we identified a sampling of types of stockbroker fraud. In Part 2, we discussed ways to avoid becoming the victim of an investment scam or stockbroker fraud. In our final post, we discuss what to do if your preventative measures fail to keep you from falling prey to a stockbroker’s unscrupulous behavior. You can protect your money

Dealing with Stockbroker Fraud

There are several actions that can be undertaken after uncovering fraud, and some things that should be done to recover the money you’ve lost as a result of stockbroker fraud.

Call a Stockbroker Fraud Lawyer

If you think you have been someone’s prey in an investment fraud scheme, contacting a qualified investment fraud attorney first can be one the smartest and most important thing to do. Fraud, like many other illegal activities, has a statute of limitations. You need to make sure you protect your rights within the timeframe specified by the law or you could forfeit your right to recover anything, no matter how guilty the perpetrator is. An experienced stockbroker fraud lawyer should be able to review your case and provide you with advice on how to proceed.

Escalate Your Complaint to a Higher Level

If you are dealing with an individual stockbroker, you also can contact the broker’s supervisor to express that you believe the broker might have engaged in misconduct. If the supervisor doesn’t help, or will not help, which often is the case, you should immediately contact an investment fraud lawyer.

Importantly, even if the supervisor represents that they will investigate your claims, you still should contact a stockbroker misconduct lawyer. To avoid getting sued, many brokerage firms will not disclose to an investor that they believe that the broker did something wrong. An independent analysis of your claims by an experienced investment fraud lawyer likely will give you the most accurate opinion of the nature and extent of misconduct that has been committed.

File an Arbitration Claim or Lawsuit

Suing the brokerage firm may not be the first thing that should be done, but it often is the only means of recovering investment losses. Brokerage firms rarely offer to pay investors for investment losses if the investor has not forced the brokerage firm’s hand by filing a FINRA arbitration claim or lawsuit against the brokerage firm. [Note: Most brokerage firms require that disputes with investors be filed through FINRA’s arbitration system rather than through the court system.]

An Attorney May be Best at Responding to Stockbroker Fraud

This brings us back to our first tip, which is consulting an experienced investment fraud lawyer: an attorney can help you identify the nature and extent of the wrongdoing and the strengths in your case, and advise you on the best way to proceed. An experienced stockbroker fraud attorney can help you navigate the FINRA arbitration system.

Most stockbroker fraud lawyers work on a contingency-fee basis, which means that they only get paid when and if they help you recover money. Their fee typically is a percentage of the money that they recover for you.

Call a Stockbroker Fraud Attorney Today

If you have suffered a loss because your broker or brokerage firm misrepresented or omitted crucial information before you invested, you may have legal rights that require your immediate attention.

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

Avoiding Stockbroker Fraud is the best way to protect your money.

Part 2: Identifying and Avoiding Stockbroker Fraud

Protect Your Money by Avoiding Stockbroker Fraud

In the first blog post in our blog series, we discussed the basics of what a stockbroker does and some examples of ways in which one can be victimized by an unscrupulous stockbroker. As we mentioned before, the types of stockbroker fraud we mentioned are not comprehensive. Rather, our blog is meant to demonstrate that there are numerous forms of stockbroker fraud. When in doubt, consult a qualified professional.

Now that you know to be on the lookout for potential stockbroker fraud, spotting it is not always as it easy as it may seem. A stockbroker intent on committing fraud often can disguise their misconduct through artful and convincing sales pitches. A Ponzi schemer, for example, has a goal of luring you away from your money by promising something otherwise unattainable, like extremely high rates of return. Many Ponzi schemers have defrauded even savvy investors out of millions – and even billions – of dollars.

4 Steps to Avoiding Stockbroker Fraud

There is no sure-fire way to detect stockbroker fraud, but the following tips can help you make sure that you and your money are being treated both fairly and legally:

  • Ask questions. Gather as much information as you can – if you don’t like or understand the answers, ask for clarification or seek another opinion. Stockbrokers are obligated to disclose not only the upside of investments but also the risks.
  • Get a second opinion. While brokers earn a living based on sales of stocks and other securities, any broker worth their reputation should not be afraid to let you perform your due diligence before investing. If you feel pressured to make an immediate decision, it may be because the person selling to you might not want you to uncover whatever it is he or she is trying to hide.
  • Do your homework. There are many ways to gather information, and you should use every means at your disposal. The Financial Industry Regulatory Authority (FINRA) has an excellent BrokerCheck tool where you can see if your broker or the firm has ever been accused of any wrongdoing.
  • When in doubt, consult a lawyer. If you are worried that something just doesn’t add up, or even if you just have questions, consult a qualified securities attorney who can help make sure that your account is accurate, and your investments are legitimate – and legal.

Even a savvy, experienced investor who has done their homework is not 100% safe from investment fraud; however, by following the steps outlined above, you can give yourself a chance to avoid being victimized.

Stay tuned for our final installment in our stockbroker fraud series in which we discuss what to do in the unfortunate event that you become the victim of stockbroker fraud.

Call a Stockbroker Fraud Attorney Today

If you have suffered a loss due to stockbroker fraud, you may have legal rights that require your immediate attention.
Contact an attorney today to schedule an appointment or consultation to review your rights and options.

Understanding Stockbroker Fraud

Part 1: Explaining & Understanding Stockbroker Fraud

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.

Steps to Preventing Stockbroker Fraud

4 Steps to Preventing Stockbroker Fraud

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.

What Should I Do If I Suspect Stockbroker Fraud?

What is Stock Fraud?

Stockbroker fraud is any deceptive practice used to induce you to purchase or sell securities on the basis of misleading, false, or wrong information.

Types of Stock Fraud

Fraud comes in all types and forms, including activities that are not illegal per se, but whose cumulative activities make them fraudulent. For example, if your broker conducts a trade on your account which generates little or no profit, there may not be anything inherently improper or illegal. But if this becomes a repeated pattern, it is possible your broker is making trades or “churning” your account to generate commissions, without regard for whether the trades make sense for you.

Stockbroker fraud also likely occurs when your broker:  (a) offers you a “guaranteed winner,” (b) trades without your permission, (c) over-concentrates your accounts in a single security or industry, (d) is negligent, or (e) recommends unsuitable investments for your portfolio.

Brokers must follow your explicit instructions and recommend only those investments that are consistent with you risk profile and investment objectives. If you suspect your broker has failed to meet these obligations or has failed to provide you with accurate information regarding a transaction, you may be the victim of broker fraud.

What Can I Do?

Before you choose a broker check their disciplinary records by using FINRA’s Broker Check tool that will allow you to search by name and firm. Then if you suspect wrongdoing in your account, you should get a second opinion about your broker’s activity by calling a stockbroker fraud lawyer.

Call a Los Angeles Stock Fraud Attorney Today!

If you have lost money in your account and you suspect your broker misled you about the risks of an investment or an investment strategy or otherwise made unsuitable investments, you may have certain legal rights that require your immediate attention.

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