FINRA Plans to Fine MetLife for Purported Variable Annuities Violations
The Financial Industry Regulatory Authority is looking to impose a significant fine against MetLife’s broker-dealer unit related to possible violations involving variable annuities. The company is cooperating with the regulator’s probe, which is looking at alleged suitability, misrepresentation, and supervision issues related to the selling and replacements of variable annuities.
According to MetLife’s quarterly regulatory filing, FINRA told the insurance giant that it plans to recommend disciplinary action. InvestmentNews reports that in an e-mailed statement, MetLife spokesperson John Calagna said that the company did not agree with the conclusions reached by the regulator and plans to defend itself.
SEC Charges Scottish Trader with Over Market Rigging Involving False Tweets
The Securities and Exchange Commission has filed securities fraud charges against James Alan Craig of Scotland for allegedly filing false tweets that caused sharp declines in the stock prices of two companies, even causing one of them to experience a trading halt. The regulator said that Craig sent out false statements via Twitter on accounts that he deceptively set up to make them look like legitimate Twitter accounts of known securities research firms.
According to the SEC’s complaint, Craig’s first bogus tweets caused the share price of one company to drop 28% until Nasdaq temporarily stopped trading. The next day, he sent out false tweets about another company that led to a 16% drop in the share prices of that company. Both days he purchased and sold shares of the companies he targeted to try to profit from the sharp price changes. He was mostly successful in his efforts.
Meantime, prosecutors in Northern California have filed criminal charges against the Scottish trader.
California Man is Ordered to Stop Bilking Investors Through Crowdfunding
A federal judge told Joseph Gabaldon and his company Ascenergy to cease from using crowdfunding to bilk investors in what the Securities and Exchange Commission has called a $5 million financial fraud. U.S. District Judge Gloria M. Navarro granted the regulator’s request for a preliminary injunction and told Ascenergy and Navarro to stop using fake information and employing fraudulent methods to bring in more investors.
In its securities fraud lawsuit, the SEC said that Gabaldon and his company committed two counts of securities fraud. Neither of them nor the company’s securities were registered with the Commission. The agency says that Ascenergy, which is supposedly an oil and gas company, raised some $5 million from approximately 90 investors and spent $1.2 million, with only a few thousands dollars going toward actual oil and gas-related costs. Instead, most of the money went to Gabaldon, his companies for other expenses, and his personal spending.
The SEC says that after Gabaldon and other company employees were subpoenaed by the Commission, Ascenergy shut off public access to its website and moved $3.8 million to Pyckl LLC, which has obvious ties to the oil and gas business. The SEC has also filed a securities charge against Pyckl and another company, Alanah Energy LLC, as relief defendants. Neither Pyckl nor its securities were ever registered with the SEC.
Finra to seek a ‘significant fine’ from MetLife over variable annuity sales, InvestmentNews, November 6, 2015
SEC Charges: False Tweets Sent Two Stocks Reeling in Market Manipulation, SEC, November 5, 2015
Judge Enjoins Crowd-Funding Securities Fraud, Courthouse News Service, November 4, 2015