Articles Posted in Promissory Notes

The Securities and Exchange Commission has charged Daniel Frishberg, a Houston businessman and the host of Business Radio Network’s “The MoneyMan” show, with fraudulent conduct related to promissory note offerings that his investment advisory firm made to clients. Frishberg, who founded BizRadio and heads up Daniel Frishberg Financial Services (DFFS), has agreed to settle the Texas securities fraud charges with a $65,000 penalty. By settling, Frishberg is not denying or admitting to the alleged wrongdings. He has, however, agreed to an entry of permanent injunction and consented to a bar from associating with certain registered entities, including other investment advisers.

DFFS allegedly advised clients to invest in notes that BizRadio had issued. Some $11 million promissory notes were put out. The offering reportedly generated approximately $5.5 million between April 2008 and September 2009.

According to the SEC, Frishberg did not tell clients that his media company was in poor financial health or that the note offerings helped pay his salary at BizRadio. Instead, he allegedly approved high risk recommendations without properly disclosing the conflicts and risks. Frishberg also “personally benefited” from these investments.

Also offering the notes was Kaleta Capital Management, whose owner, Albert Fase Kaleta, jointly controls BizRadio with Frishberg. In 2009, Kaleta and his financial firm were charged with securities fraud. Frishberg is accused of knowing that prior complaints had been made about Kaleta and his handling of sales representations related to other investments yet still opting to have him recommend the promissory notes.

The SEC contends that Frishberg has violated the Investment Advisers Act of 1940’s Section 206(2). He also allegedly abetted and aided violations of Sections 206(1) and 206(2) of the Advisers Act.

Related Web Resources:
SEC Charges Houston-Area Businessman and Talk Radio “MoneyMan” for Fraudulent Conduct at Advisory Firm, SEC, March 25, 2011
SEC charges radio personality with fraud, Investment News, April 5, 2011
The Money Man Report

Investment Advisers Act

More Blog Posts:
Motion to Dismiss SEC Lawsuit Accusing Dallas Billionaire Brothers of $500,000 Securities Fraud Denied, Stockbroker Fraud Blog, April 1, 2011
FBI Arrests Texas Leader of Pump-and-Dump Scheme, Stockbroker Fraud Blog, March 23, 2011
Dallas-Based Southwest Securities Settles for $500,000 FINRA Charges It Improperly Used Paid Consultants, Stockbroker Fraud Blog, March 17, 2011 Continue Reading ›