Ex-Newbridge Securities Broker Involved in $131M Fraud Pleads Guilty
Gerald Cocuzzo, has pleaded guilty to securities fraud related to his involvement in a $131M market manipulation scam involving Forcefield Energy Inc. (FNRG). According to the U.S. Justice Department, between 1/2009 and 4/2015, Cocuzzo and others sought to bilk investors in the publicly traded company that globally distributes and provides LED lighting products. They did this by artificially manipulating the volume and price of the shares that were traded.
Meantime, Cocuzzo received kickbacks for buying Forcefield stock in his clients’ brokerage accounts. He did not tell the customers that he was receiving these payments. Instead, he and several others sought to hide their involvement.
Newbridge Securities fired Cocuzzo earlier this year following the federal indictment. Before working at Newbridge, he was registered with IAA Financial, previously called CBG Financial Group Inc.
Cocuzzo is one of nine brokers charged by prosecutors and the SEC in the $131M stock scam.
LPL Financial Broker Banned For Depositing Client Money Into His Own Account
The Financial Industry Regulatory Authority has permanently barred Dominic Thomas Debruin. The regulator’s department of enforcement investigated the LPL Financial (LPLA) broker for allegedly placing clients’ funds into a bank account under his control.
According to the settlement notice, the money was “related to potential private securities transactions” that were not disclosed to the brokerage firm. Although Finra asked DeBruin to give testimony, he refused. He agreed to the permanent bar but is not denying or admitting to the regulator’s findings.
According to his BrokerCheck profile, DeBruin has been involved in four financial disputes that are now resolved. Prior to going to work with LPL Financial in 2012 he worked with Waddell & Reed (WDR), Prudential Investment Management Services, Paulson Investment Co., Paragon Capital Corp., Argent Securities, Continental Broker-Dealer Corp., and First Hanover Securities Inc.
Lincoln Financial Network Independent Broker-Dealer Ordered to Pay $650K
FINRA has fined Lincoln Financial Securities Corp. $650K for not reasonably safeguarding confidential customer data and exposing thousands of records to foreign hackers. The brokerage firm is a Lincoln Financial Network independent broker-dealer.
According to the regulator, from at least ’11 to ’15, Lincoln Financial Securities did not maintain and enforce a reasonably designed supervisory system to make sure that confidential customer data stored on firm electronic systems was secured. As a result, contends the regulator, hackers were able to access the information through a cloud server, exposing the confidential information of about 5,400 customers.
By settling, Lincoln Financial Securities is not denying or admitting to the FINRA claims. FINRA noted in the settlement that the firm had similar issues in 2011 regarding the purported failure to set up sufficient procedures to protect confidential customer data on its electronic portfolio management system, as well as other alleged securities violations. For those allegations, the broker-dealer consented to a $450K fine.
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Stockbroker Pleads Guilty in 131M Securities Fraud, New York Post, July 27, 2016
The SEC Complaint in the Case Against Cocuzzo (PDF)
Finra bans LPL broker for depositing funds into own bank account, InvestmentNews, November 14, 2016
Lincoln Financial Securities Corp. Settles for $650K Enforcement Fine, IAAP, November 18, 2016