Financial Firms

Texas Retirees Pursues 6-Figure GWG L Bond Claim Against Centaurus Financial

Published on: May 16, 2022 | by Shepherd Smith Edwards & Kantas, LLP

Elderly Couple is Seeking Up to $500K Plus Interest and Costs Against Centaurus Financial

Two older investors, both retired and on disability, have filed a Financial Industry Regulatory Authority (FINRA) arbitration claim against brokerage firm Centaurus Financial over losses they sustained from purchasing GWG L Bonds.

GWG Holdings, Inc., a Dallas-based alternative asset firm, filed for Chapter 11 bankruptcy in April 2022. Now, this Texas couple is among the many thousands who have been left holding these high-risk, illiquid junk bonds that may not be worth much at all at this point.

Emerson Equity Broker Tony Barouti Facing $1.37M in GWG L Bond Claims

Published on: May 16, 2022 | by Shepherd Smith Edwards & Kantas, LLP

Los Angeles-Based Financial Advisor Allegedly Targeted Customers of Iranian Heritage

In an earlier GWG L Bond blog post, our securities attorneys reported we were looking into whether customers of Emerson Equity broker Tony Barouti had suffered losses in these high-yield bonds. In March 2022, investors filed two investor claims seeking $1.37M in damages.

Brokerage firm Emerson Equity is the managing broker-dealer for the GWG issuer of $1.6B of L bonds, backed by life settlements. On April 20, 2022, GWG Holdings, Inc. filed for Chapter 11 bankruptcy protection. The move came just two months after the Texas-based alternative asset firm defaulted on $13.6M in bond payments and interest it owed L Bond investors.

FINRA Fines Berthel Fisher $100K Over Options Trades

Published on: May 11, 2022 | by Shepherd Smith Edwards & Kantas, LLP

Berthel Fisher & Co Accused of Supervisory and Compliance Issues Involving a Customer

The Financial Industry Regulatory Authority (FINRA) announced that Berthel Fisher & Co. had been ordered to pay a $100K fine. This fine concerns shortcomings related to compliance involving options trades in a customer’s account. The firm is not denying or admitting to the self-regulatory organization’s (SRO) findings.

According to FINRA, in August 2015, while looking over a customer’s request for approval to trade options in his account, Berthel Fisher & Co neglected to conduct due diligence. The broker-dealer failed to ensure that this type of transaction was suitable based on the client’s investment experience.

Former Customers of Calton & Associates Broker Paul Murphy Request Over $589K in Damages

Published on: May 11, 2022 | by Shepherd Smith Edwards & Kantas, LLP

Calton & Associates Financial Advisor Accused of Unsuitability and Misrepresentations

Paul William Murphy, currently a Calton & Associates registered representative, is named in two pending customer disputes where the claimants are seeking over $589K. These latest allegations appear to stem from when Murphy was a Newport Coast Asset Management and a Newport Coast Securities broker. Newport Coast was expelled by the Financial Industry Regulatory Authority (FINRA) in 2018.

Our Florida broker misconduct lawyers investigate claims of losses by investors who have worked with Paul Murphy as their financial advisor. In Florida, call Shepherd Smith Edwards and Kantas (SSEK Law Firm at investorlawyers.com) at (813) 560-2992. You can also reach us nationwide at (800) 259-9010 today.

Barred Ex-Wells Fargo Broker Jeremy Fortner is Named in Nine Customer Disputes

Published on: May 6, 2022 | by Shepherd Smith Edwards & Kantas, LLP

Ex-Wells Fargo Broker Jeremy Fortner Allegedly Borrowed Money From Clients

Our broker misconduct lawyers investigate claims of losses involving former customers of ex-Wells Fargo Advisors registered representative Jeremy Fortner. The broker-dealer fired him in August 2021 in the wake of allegations that he inappropriately borrowed funds.

In November 2021, with a starting date of March 3, 2022, the Financial Industry Regulatory Authority (FINRA) permanently barred Fortner after he did not respond to requests for information into its investigation. Jeremy Fortner was a registered broker and investment adviser for 16 years.

At Least 27,000 L Bond Investors Left At a Loss Following GWG Holdings’ Bankruptcy Filing

Published on: April 26, 2022 | by Shepherd Smith Edwards & Kantas, LLP

Despite Misgivings, Court Approves $10M Financing for Troubled GWG Holdings

One day after GWG Holdings filed for Chapter 11 bankruptcy protection, Judge Marvin Isgur of the US Bankruptcy Court in Houston approved $10M in financing for the asset manager despite his concerns regarding the mechanics of the loan. The emergency loan will come from National Founders LP.

According to The Wall Street Journal (WSJ), in court papers, GWG said it needed the money to avoid “imminent liquidation.” The Texas-based alternative asset firm owes about $1.6B in L Bonds. Despite being illiquid and high-risk, these high-yield bonds were mainly marketed to individual investors by around 145 regional brokerage firms, including managing broker-dealer Emerson Equity. They earned high commissions of around 8% from the transactions.

Following GWG Holdings’ Chapter 11 Bankruptcy, SSEK Law Firm Steps Up Investigation of Brokerage Firms That Sold L Bonds

Published on: April 25, 2022 | by Shepherd Smith Edwards & Kantas, LLP

High-Yield GWG L Bonds May Now Be Worth 20 to 30 Cents on The Dollar

Our high-yield bond lawyers investigate brokerage firms that sold GWG L Bonds to their customers. On April 20, 2022, GWG Holdings, Inc., the issuer of these junk bonds, announced that it had filed for Chapter 11 bankruptcy protection.

The news comes in the wake of a slew of troubles involving the Texas-based alternative firm. GWG Holdings owes investors $13.6M in principal payments plus interest and is way behind in submitting yearly regulatory filings. It also has been under investigation by the US Securities and Exchange Commission (SEC) since 2020.

SEC Sues Ex-Morgan Stanley Broker Shawn Good Over Alleged $4.8M Ponzi Scam

Published on: April 25, 2022 | by Shepherd Smith Edwards & Kantas, LLP

Ex-Morgan Stanley Broker Accused of Defrauding Investors, Including Retirees

The Securities and Exchange Commission (SEC) has filed civil charges against former Morgan Stanley financial advisor Shawn Edward Good accusing him of operating a years-long Ponzi scheme and misappropriating millions of dollars from customers.

Shawn Good is accused of raising at least $4.8M from five clients at the firm, including retirees and a single mom with young children, to supposedly invest in low-risk, tax-free bonds and land development projects.

GWG Holdings Files For Chapter 11 Bankruptcy Protection

Published on: April 22, 2022 | by Shepherd Smith Edwards & Kantas, LLP

Issuer of L Bonds Says SEC’s Probe Contributed to Its Demise

In the US Bankruptcy Court for the Southern District of Texas on April 20, 2022, GWG Holdings, Inc. (GWGH) voluntarily filed for Chapter 11 bankruptcy protection. The move was expected in the wake of the regulatory and financial woes plaguing the Dallas-based alternative firm.

GWG Holdings’ bankruptcy is bad news for investors, many of whom are retail customers, including elderly investors and retirees. In February 2022, the company, which sold $1.6B in life-settlement backed bonds via independent brokerage firms, had defaulted on $13.6M in principal payments and interest it owed investors of its L Bond series.

Ex-Transamerica Financial Advisors Broker Scott Allen Fries Ordered To Pay Over $747K For Allegedly Defrauding Investors

Published on: April 21, 2022 | by Shepherd Smith Edwards & Kantas, LLP

SEC Obtains Default Judgment Against Former Cincinnati, Ohio Registered Representative

The Securities and Exchange Commission (SEC) has obtained a default judgment against Scott Allen Fries. He was a Transamerica Financial Advisors registered representative from 2014 to 2019.

The regulator’s amended complaint accuses the former broker and investment advisor of raising approximately $458K from at least ten investors, including customers from the brokerage firm, and using the funds to pay for his personal expenses. Fries is barred from further fraud violations and must pay disgorgement of $428,334.53, a civil penalty of $208,500, and a prejudgment interest of $110,548.02.