Colling, Gilbert, Wright & Carter Securites Fraud
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Friday, January 22, 2010
Report Shows Individual Securities Case Filings Rose Sharply in 2009
According to Advisen Ltd. Report Securities class action filings were flat, but regulator suits rose sharply.
The press release appears below:
Economic turmoil drove a surge in securities lawsuit filings in 2009, according to a new report from Advisen Ltd. The year saw securities lawsuit filings grow at a robust 13 percent rate to 910 suits, eclipsing an already-elevated 2008 at 804 suits. The number of securities class action suits filed was essentially unchanged, with 234 suits filed in 2009 compared to 239 the prior year, while the number of securities fraud suits filed by regulators grew sharply, with a 22 percent increase over 2008.
³Litigators and regulators stayed busy in 2009,² noted John W. Molka III, the author of the report. ³The first half of the year was dominated by credit crisis- and Madoff-related lawsuits. Those types of suits fell off sharply in the second half, but plaintiffs¹ attorneys had a backlog of other cases waiting to be filed.² Although securities class action filings were essentially flat as compared to 2008, they decreased as a percentage of all securities suit filed, coming in at about a quarter of the total. That represents a continuation of a downward trend that began in 2005, when securities class action suits represented about half of all securities suits filed.
³Securities class action suits filed in federal courts account for many of the largest settlements, but every year they represent a smaller percentage of the total number of securities suits filed,² explained Dave Bradford, Advisen¹s executive vice president. ³A growing threat to companies and their directors is escalating enforcement actions and lawsuits by regulators.
Also, breach of fiduciary duty suits and other securities suits filed in state courts are on the rise. ² Advisen¹s report, Securities Suits Abound in a Harsh 2009, also reviews trends in awards and settlements, and analyzes the factors likely to influence settlement values in the coming years. Sharply higher losses to shareholders in securities class action suits, as measured by Advisen¹s Market Cap Impact Metric , suggest that settlements may be larger for suits filed in 2009, but it is likely that a higher than average percentage of 2009 suits will be dismissed.
Click here for the full report.
A number of banks and brokerage firms have been targets of regulatory inquiries in cluding Regions Bank for their marketing and sale of the RMK Bond Funds; UBS for the sale of their proprietary Principal Protected Notes (PPNs), Partially Principal Protected Notes (PPPNs), Return Optimation Notes (RONs); OppenheimerFunds for the marketing and sale of the Champion Income Fund; Wachovia Bank for the sale of the Evergreen High Income Fund; and Regional firms for the sale of DBSI Notes and direct Investments and the subequent bankruptcy filings.
IF you have lost money related to these or any other security that is the subject of regulatory inquiry, please contact our office for a free case evaluation. Thank you.
The press release appears below:
Economic turmoil drove a surge in securities lawsuit filings in 2009, according to a new report from Advisen Ltd. The year saw securities lawsuit filings grow at a robust 13 percent rate to 910 suits, eclipsing an already-elevated 2008 at 804 suits. The number of securities class action suits filed was essentially unchanged, with 234 suits filed in 2009 compared to 239 the prior year, while the number of securities fraud suits filed by regulators grew sharply, with a 22 percent increase over 2008.
³Litigators and regulators stayed busy in 2009,² noted John W. Molka III, the author of the report. ³The first half of the year was dominated by credit crisis- and Madoff-related lawsuits. Those types of suits fell off sharply in the second half, but plaintiffs¹ attorneys had a backlog of other cases waiting to be filed.² Although securities class action filings were essentially flat as compared to 2008, they decreased as a percentage of all securities suit filed, coming in at about a quarter of the total. That represents a continuation of a downward trend that began in 2005, when securities class action suits represented about half of all securities suits filed.
³Securities class action suits filed in federal courts account for many of the largest settlements, but every year they represent a smaller percentage of the total number of securities suits filed,² explained Dave Bradford, Advisen¹s executive vice president. ³A growing threat to companies and their directors is escalating enforcement actions and lawsuits by regulators.
Also, breach of fiduciary duty suits and other securities suits filed in state courts are on the rise. ² Advisen¹s report, Securities Suits Abound in a Harsh 2009, also reviews trends in awards and settlements, and analyzes the factors likely to influence settlement values in the coming years. Sharply higher losses to shareholders in securities class action suits, as measured by Advisen¹s Market Cap Impact Metric , suggest that settlements may be larger for suits filed in 2009, but it is likely that a higher than average percentage of 2009 suits will be dismissed.
Click here for the full report.
A number of banks and brokerage firms have been targets of regulatory inquiries in cluding Regions Bank for their marketing and sale of the RMK Bond Funds; UBS for the sale of their proprietary Principal Protected Notes (PPNs), Partially Principal Protected Notes (PPPNs), Return Optimation Notes (RONs); OppenheimerFunds for the marketing and sale of the Champion Income Fund; Wachovia Bank for the sale of the Evergreen High Income Fund; and Regional firms for the sale of DBSI Notes and direct Investments and the subequent bankruptcy filings.
IF you have lost money related to these or any other security that is the subject of regulatory inquiry, please contact our office for a free case evaluation. Thank you.
posted by
William B. Young Jr. Esq.
at
8:23 AM
Tuesday, January 5, 2010
SunTrust Securities Slapped with $4.1 Million Dollar Damage Award
A FINRA arbitration panel found Suntrust Securities (now known as SunTrust Robinson Humphry), the securities brokerage arm of SunTrust Banks, Inc., guilty of defaming one of its former brokers. The award included $1.2 million dollars in compensatory damages, $2.5 million in punitive damages plus attorney's fees and cost. Punitive damages are typically used to punish the wrong doer and dissuade similar conduct in the future. The punitive damage award was the arbitration Panel way of sending a message that such conduct will not be tolerated. The full Wall Street journal article appears below.
A Financial Industry Regulatory Authority arbitration panel has ordered SunTrust Robinson Humphrey, Inc. to pay a
total of $4.1 million to a former institutional salesman who alleged the
company defamed him in a regulatory filing.
Lance B. Beck, a former broker in the Atlanta branch of Suntrust
Robinson Humphrey, the corporate and investment banking services arm of
SunTrust Banks, Inc. (STI), was awarded $1.2 million in compensatory
damages, an additional $2.5 million in punitive damages and $419,000 in
attorney's fees, according to an arbitration order dated Dec. 29.
A statement of claim filed in the case by Beck accused the firm of
including a "devastating" disclosure on his Form U5, which brokerages
must file with regulators when a broker leaves, related to a $2.9
million auction-rate securities transaction. The Finra panel recommended
the language, which included the designation "permitted to resign" as a
reason for Beck's termination and the phrase "failure to follow firm
sales-practice policy," be expunged.
A spokesman for SunTrust Banks didn't immediately return a call
requesting comment.
The attorneys at Colling, Gilbert, Wright and Carter represent brokers and financial advisers in employment related disputes.
A Financial Industry Regulatory Authority arbitration panel has ordered SunTrust Robinson Humphrey, Inc. to pay a
total of $4.1 million to a former institutional salesman who alleged the
company defamed him in a regulatory filing.
Lance B. Beck, a former broker in the Atlanta branch of Suntrust
Robinson Humphrey, the corporate and investment banking services arm of
SunTrust Banks, Inc. (STI), was awarded $1.2 million in compensatory
damages, an additional $2.5 million in punitive damages and $419,000 in
attorney's fees, according to an arbitration order dated Dec. 29.
A statement of claim filed in the case by Beck accused the firm of
including a "devastating" disclosure on his Form U5, which brokerages
must file with regulators when a broker leaves, related to a $2.9
million auction-rate securities transaction. The Finra panel recommended
the language, which included the designation "permitted to resign" as a
reason for Beck's termination and the phrase "failure to follow firm
sales-practice policy," be expunged.
A spokesman for SunTrust Banks didn't immediately return a call
requesting comment.
The attorneys at Colling, Gilbert, Wright and Carter represent brokers and financial advisers in employment related disputes.
posted by
William B. Young Jr. Esq.
at
1:37 PM
Elderly Investor Receives $1.6 Million Including Treble Damages from FINRA Arbitration Panel
In what is believed to be one of the first rulings of its kind, a 95-year old California man received $1.6 million dollar award from a Financial Industry Regulatory Authority arbitration Panel against an on-line brokerage firm finding, among the offenses, elder abuse. The California elder abuse statue, like many similar state statutes (including Florida), allows for treble damages in instances where there is a finding of elder abuse. However, the courts have normally applied this statute in the caretaker relationship wherein a caregiver takes advantage of an elderly and doe not apply in the financial investor/investment advisor relationship. This ruling could send chills throughout the brokerage community as so many claims of negligence and fraud stem from losses suffered by elders and retirees.
Excerpts from the January 5, 2010 Investment News article appear below:
In a rarity, an arbitrator last month cited elder abuse in tripling the damages a discount securities firm must pay a 95-year-old client.
A Financial Industry Regulatory Authority panel awarded the elderly investor, David Wolfson, $1.6 million in a case involving StockCross Financial Services Inc. of Beverley Hills, Calif. Mr. Wolfson accused StockCross, along with two of its brokers, of misconduct and self dealing. He claimed the brokers recommended and solicited unsuitable and overly risky investments that were actively traded on margin.
The claim, which was filed in March, also alleged that StockCross and the two brokers, Thomas B. Cooper and Peter L. Boorn, put Mr. Wolfson's home at risk. According to the complaint, they “encouraged and invited Mr. Wolfson to leverage the equity in his home with a reverse-mortgage transaction to utilize as investment capital.”
While many arbitration claims charge elder abuse, it is extremely rare for Finra panel to cite such abuse in an award, said David Liebrader, an attorney that represents both investors and brokers against securities firm. Under California law, elder abuse entitles plaintiffs triple the damages.
According to the complaint, Mr. Wolfson was a client of Mr. Cooper for almost 20 years, when Mr. Cooper dropped the account in 2008.
A footnote to the lawsuit alleged that Mr. Cooper “quit because he had bilked nearly all of Mr. Wolfson's assets—including the equity in his home, all his cash reserves, all his emergency/medical cash reserves and even the insurance money Mr. Wolfson received to replace his automobile—and there was nothing left to churn.”
The arbitrators awarded Mr. Wolfson $320,000 in compensatory damages and $960,000 in damages for elder abuse. They also awarded the 95-year-old $234,000 in legal fees, expert witness fees of $62,000, various costs of $21,000 and $10,000 as sanctions for failing to follow discovery orders.
StockCross and the brokers will fight the decision and file a motion to vacate, said Martin H. Kaplan, the attorney filing the motion. Such motions to vacate are essentially court appeals of Finra arbitration awards, which are very difficult to overturn.
The attorneys at Colling, Gilbert, Wright & Carter are currently representing numerous retirees in actions against their former brokerage firms and insurance providers and have recovered losses for elders and retirees throughout the United States. If you believe you or someone you know has been taken advantage of by their investment advisor, please contact our firm for a free consultation.
Excerpts from the January 5, 2010 Investment News article appear below:
In a rarity, an arbitrator last month cited elder abuse in tripling the damages a discount securities firm must pay a 95-year-old client.
A Financial Industry Regulatory Authority panel awarded the elderly investor, David Wolfson, $1.6 million in a case involving StockCross Financial Services Inc. of Beverley Hills, Calif. Mr. Wolfson accused StockCross, along with two of its brokers, of misconduct and self dealing. He claimed the brokers recommended and solicited unsuitable and overly risky investments that were actively traded on margin.
The claim, which was filed in March, also alleged that StockCross and the two brokers, Thomas B. Cooper and Peter L. Boorn, put Mr. Wolfson's home at risk. According to the complaint, they “encouraged and invited Mr. Wolfson to leverage the equity in his home with a reverse-mortgage transaction to utilize as investment capital.”
While many arbitration claims charge elder abuse, it is extremely rare for Finra panel to cite such abuse in an award, said David Liebrader, an attorney that represents both investors and brokers against securities firm. Under California law, elder abuse entitles plaintiffs triple the damages.
According to the complaint, Mr. Wolfson was a client of Mr. Cooper for almost 20 years, when Mr. Cooper dropped the account in 2008.
A footnote to the lawsuit alleged that Mr. Cooper “quit because he had bilked nearly all of Mr. Wolfson's assets—including the equity in his home, all his cash reserves, all his emergency/medical cash reserves and even the insurance money Mr. Wolfson received to replace his automobile—and there was nothing left to churn.”
The arbitrators awarded Mr. Wolfson $320,000 in compensatory damages and $960,000 in damages for elder abuse. They also awarded the 95-year-old $234,000 in legal fees, expert witness fees of $62,000, various costs of $21,000 and $10,000 as sanctions for failing to follow discovery orders.
StockCross and the brokers will fight the decision and file a motion to vacate, said Martin H. Kaplan, the attorney filing the motion. Such motions to vacate are essentially court appeals of Finra arbitration awards, which are very difficult to overturn.
The attorneys at Colling, Gilbert, Wright & Carter are currently representing numerous retirees in actions against their former brokerage firms and insurance providers and have recovered losses for elders and retirees throughout the United States. If you believe you or someone you know has been taken advantage of by their investment advisor, please contact our firm for a free consultation.
posted by
William B. Young Jr. Esq.
at
12:07 PM
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Previous Posts
- Report Shows Individual Securities Case Filings Ro...
- SunTrust Securities Slapped with $4.1 Million Doll...
- Elderly Investor Receives $1.6 Million Including T...
- Investor Awarded Damages against UBS in Lehman Str...
- CA Attorney General Recovers $1.4 Billion from Wel...
- Two Bear Stearns Hedge Fund Managers Acquitted
- More Information Releaed on Morgan Keegan RMK Bond...
- SEC Taps "Wizz Kid" to Head Up Enforcement Divisio...
- Citigroup Fined for Failure to Supervise Stock Tra...
- FINRA Extending Public Arbitrator Pilot Program
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