Mutual Funds

Mutual Fund Abuse Attorney

Published on: October 30, 2024 | by Shepherd Smith Edwards & Kantas, LLP

Commonwealth Financial Network Ordered To Pay $93.3M Over Mutual Fund Revenue Sharing

SEC Alleged Breach of Fiduciary Duty When Firm Recommended Mutual Fund Shares That Paid It Fees

Earlier this year, Commonwealth Financial Network was ordered to pay $93.3M in a breach of fiduciary duty lawsuit filed by the US Securities and Exchange Commission (SEC) in 2019. The regulator claimed that the independent broker-dealer and investment adviser did not disclose material conflicts of interest involving revenue-sharing agreements with clearing firm National Financial Services.

Mutual Fund Switching Loss Attorneys

Published on: July 23, 2024 | by Shepherd Smith Edwards & Kantas, LLP

Did You Suffer Mutual Fund Losses While Working With Suspended Florida Broker John Wigmore Reilly III?

Ex-Securities Research Financial Advisor Accused of Best Interest Violations

Shepherd Smith Edwards and Kantas Mutual Fund Switching Loss Attorneys (investorlawyers.com) are offering free, no obligation case assessments to customers of former stockbroker John Reilly III. The Financial Industry Regulatory Authority (FINRA) suspended him for three months after finding that he purportedly violated customers’ best interests when he allegedly engaged in mutual fund switching that resulted in excessive sales fees for two older investors.

Mutual Fund Investment Loss Attorneys

Published on: February 28, 2023 | by Shepherd Smith Edwards & Kantas, LLP

Our Closed-End Mutual Fund Investment Loss Attorneys Work With Retail Investors, Retirees and Others

Priority Income Fund Investors Are Wondering What To Do After Liquidity Strategy Changes

While many investors generally think of mutual funds as safe, low-risk investments, that is not always the case. Now, in the wake of Priority Income Fund disclosing to the US Securities and Exchange Commission (SEC) that there has been a change to its liquidation strategy, investors of this closed-end mutual fund may be grappling with what they should do to protect their money.

Infinity Q Founder James Velissaris Accused of Over $1B Valuation Fraud

Published on: March 14, 2022 | by Shepherd Smith Edwards & Kantas, LLP

Brokerage Firms Sold Infinity Q Diversified Alpha Fund and Volatility Alpha Fund to Investors

The US Securities and Exchange Commission (SEC) has filed civil charges against James Velissaris, the founder and ex-chief investment officer of Infinity Q Capital Management. According to the regulator, Velissaris allegedly overvalued assets by over $1B while “pocketing” tens of millions of dollars in fees.

This is bad news for investors who were marketed and sold the Infinity Q Diversified Alpha mutual fund and the Volatility Alpha private fund by broker-dealers and their financial advisors. The two funds purportedly had about $3B in assets under management.

Ex-Ameriprise Broker Angel Bardeche Accused of Earning $450K From Allegedly Unsuitable Mutual Fund Switches

Published on: January 29, 2021 | by Shepherd Smith Edwards & Kantas, LLP

FINRA Suspends Cincinnati, Ohio Financial Advisor

The Financial Industry Regulatory Authority (FINRA) has suspended former Ameriprise (AMP) stockbroker, Angel W. Bardeche, for nine months over allegations that she engaged in unsuitable mutual fund switches over a two-year period that earned her $450K in commissions.

The self-regulatory organization (SRO) also contends that the ex-Ameriprise Financial broker made 109 trades in eight non-discretionary customer accounts without authorization. Bardeche will pay a $10K fine and $5K in disgorgement.

Spirit of America Energy Investors May Have Grounds for Unsuitability Claims Against David Lerner Associates

Published on: December 8, 2020 | by Shepherd Smith Edwards & Kantas, LLP

Proprietary, Non-Traded Oil, Gas and Energy Investments Plunged In Value

If your David Lerner Associates broker recommended and sold you any of the firm’s proprietary non-traded oil and gas investments and you sustained significant losses, you may have grounds for an investor fraud claim for damages.

The privately-held broker-dealer exclusively sold investments and mutual funds to customers in its Spirit of America Energy Fund (NASDAQ: SOAEX), as well as its Energy 11 LP and Energy Resources 12 LP.

Tata Arbitrage Fund and ICICI Prudential Among the Arbitrage Funds That Temporarily Shuttered Because of Coronavirus

Published on: April 16, 2020 | by Shepherd Smith Edwards & Kantas, LLP

Market Volatility Forces Arbitrage Funds to Temporarily Close

Reports of arbitrage funds temporarily shuttering in the wake of the impact of the novel coronavirus (COVID-19) on the markets has caused concern for investors.

At Shepherd Smith Edwards and Kantas (SSEK Law Firm), our investment fraud lawyers are offering free case assessments to help you determine whether you have grounds for an investor claim. We understand the difficulties that US citizens are facing in the wake of COVID-19 and want to assure that we are here to help during this time.

Summit Investment to Pay Investor $100K for LJM Preservation and Growth Fund

Published on: November 22, 2019 | by Shepherd Smith Edwards & Kantas, LLP

Summit Investment Management To Pay Investor $100K

A Financial Industry Regulatory Authority (FINRA) panel said that Summit Investment Management and portfolio manager, Thomas Carroll, must pay one firm client $100K for investing his money in funds from the investment manager, LJM Partners, which is no longer in operation.

The LJM Preservation and Growth Fund (LJMIX) has been named in numerous complaints since early last year when it suffered a huge plunge in value of over 80% in two days. This happened after the CBO Volatility Index experienced a spike.

Cetera Advisors Accused of Defrauding Investors of $10M

Published on: September 7, 2019 | by Shepherd Smith Edwards & Kantas, LLP

The US Securities and Exchange Commission (SEC) has filed civil charges accusing Cetera Advisors of defrauding its retail clients through $10M in unnecessary commissions and fees. The regulator is accusing the registered investment adviser (RIA) of selling these customers costlier share classes even though they qualified to invest in less expensive share classes of the same funds. The clients paid the additional compensation to the firm during the time that they held the more costly investments.

According to the Commission’s complaint, from at least 9/2016 through 12/2016, these Cetera customers were invested and held in mutual fund share classes that charged them 12b-1 fees that were recurring instead of shares that didn’t charge these fees. The SEC said that aside from the fees, which was compensation paid to Cetera, the share classes were identical.

The regulator also claims that Cetera took part in a program with its clearing firm in which the latter would share service fees and revenues it was paid from certain mutual funds with the RIA. Hence, this was incentive for Cetera to sell these mutual funds instead of other investments to clients. Cetera purportedly received $1.7M as a result of this deal.

Commonwealth Accused of Not Disclosing Revenue Deal to Clients

Published on: August 16, 2019 | by Shepherd Smith Edwards & Kantas, LLP

The US Securities and Exchange Commission (SEC) is accusing Commonwealth Equity Services, also known as Commonwealth Financial Network, of not notifying clients that it had material conflicts of interest involving certain investments. This purportedly allowed the investment adviser and brokerage firm to earn more than $100M in revenue sharing involving certain mutual funds.

The SEC contends that since at least 2007, Commonwealth had a deal with National Financial Services and a Fidelity Investments affiliate that the majority of its Preferred Portfolio Service advisory clients were obligated to utilize when trading in their accounts. As part of the agreement, clients have to choose National Financial Services as its clearing broker for their investment accounts.

Whenever these advisory clients would invest in specific mutual fund shares, Commonwealth received a portion of the money that certain mutual fund companies paid National Financial Services to make trades on the platform. Also as part of the deal between National Finance Services and Commonwealth is that the clearing broker would share recurring mutual fund fees with the investment adviser. This was determined by the latter’s client assets that were invested in specific mutual fund share classes that didn’t charge a transaction fee.