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Baltimore Securities & Estate Planning Law Blog

Former Compliance Officer Faces up to 20 years in Prison

The Securities and Exchange Commission (SEC) has charged William Quigley, a former chief compliance officer of Westbury, New York based brokerage firm Trident Partners, Ltd, with fraud. According to the SEC, Quigley solicited foreign investors to invest in well-know companies along with a few start-ups and then used the money for his own personal use. Over the course of a decade, Quigley allegedly siphoned $800,000 of investors' money into his personal accounts by sending investors false account statements. Quigley was indicted on charges of wire fraud and money laundering. He faces up to twenty years in prison.

Former Frederick Attorney Faces a Maximum of 23 years

Former Frederick attorney, Richard A. Brennan, is now facing jail time after pleading guilty to mail fraud and tax charges. Brennan first opened his practice in 2006 with the main focus of providing clients with debt-settlement services. Brennan allegedly misappropriated clients' funds intended to pay off their debts, and used the money for his own needs. Over a three year period this caused his clients to lose about $2.9 million. In 2007, the Maryland Attorney General's Consumer Protection Division investigated him for these allegations. The Attorney General and Brennan came to a settlement in which he would pay $200,000 in fines and costs and repay clients harmed by his scheme. Unfortunately, Brennan never followed the terms of the settlement and never returned any of the money to his clients.

LPL Hit with $11.7 million Fine

LPL Financial was fined $11.7 million by the Financial Industry Regulatory Authority (FINRA) for supervisory failures. FINRA believes that the supervisory failures began in 2007 when LPL allegedly did not properly supervise the sale of complex products. FINRA also alleges that the system LPL had in place to review customer accounts was deficient which caused 67,000 customers to not receive 14 million trade confirmations.

Broker to Celebs Barred by FINRA

Aaron Parthemer, a Wells Fargo financial advisor to pro athletes and celebrities, has been banned from the securities industry. The Financial Industry Regulatory Authority (FINRA) claimed that Parthemer failed to disclose multiple outside business activities including running a popular Miami nightclub, Club Play. FINRA believes that Parthemer solicited his clients to invest in the nightclub and made unapproved loans involving the club. Parthemer also allegedly solicited more than a half dozen pro athlete clients to invest over $3 million in an internet branding company that was operated by a close friend. Finally, FINRA claims that Parthemer supplied false information in connection with its investigation.

Former JP Morgan Advisor Accused of Swindling $20 million from Customers

Michael Oppenheim, a former JP Morgan advisor, has been charged by federal authorities for allegedly stealing $20 million from client accounts. On over twenty occasions, Oppenheim withdrew money, anywhere from $300,000 to $2 million at a time, from clients accounts and deposited the monies into his own personal account. Oppenheim was able to carry out the fraud by providing customers with false account statements which made it appear their monies were invested in bonds. JP Morgan has pledged to reimburse victimized clients.

Financial Coach and Author Sentenced to 9 years in Prison

Financial coach and author, Bryan Binkholder, has been sentenced to nine years in prison for soliciting clients to participate in his "hard money lending" program. Prosecutors allege that the program was falsely described as a real estate investment in which Binkholder would allegedly act as a bank to developers. While Binkholder did make some loans to real estate developers, he used the majority of the money for his own personal expenses. Binkholder's sentence also requires him to pay over $3.6 million in restitution. Binkholder allegedly is planning on appealing the sentence.

Oppenheimer Ordered to pay $3.75 million

The Financial Industry Regulatory Authority (FINRA) has ordered Oppenheimer & Co. to pay a fine of $2.5 million and make restitution in the amount of $1.25 million for failing to properly supervise Mark Hotton, a financial advisor employed by the firm. Hotton is currently serving a 34 month prison sentence. According to FINRA, Oppenheimer ignored numerous red flags regarding Hotton which warranted heightened supervision measures. The lack of supervision allowed Hutton to wire over $2.9 million of client monies into his own accounts. Hotton's actions have caused Oppenheimer to pay more than $6 million to settle customer disputes.

Morgan Stanley Facing $400 Million Claim after Advisor has Affair with Client

Morgan Stanley advisor Ami Forte is accused of having an affair with the now deceased co-founder of the Home Shopping Network, Roy Speer. According to Mr. Speer's widow, at the time of his death, her husband was both physically and mentally impaired. He was wheelchair bound with a full time caregiver. His declining mental capacity made it difficult for him to oversee his financial matters, so he delegated Forte to take care of some of his financial matters. Mr. Speer's widow is now accusing Forte of making approximately 12,000 unauthorized trades in a five year period leading up to his death. These trades produced almost $40 million in commissions.

Farm Loan Ponzi Scheme Costs Investors Millions

Matthew Haab, president of Partners Inc., faces charges by the Securities and Exchange Commission (SEC) for allegedly running a Ponzi scheme. The SEC believes that Haab deceived eighty of his clients into investing in loans to farmers. The clients were told that the loans would be used to aid farmers in the 2013-2014 growing season. As a result, Haab and his firm was able to raise about $15 million through the scheme. Nearly half of the money earned went to past investors. According to a Wall Street Journal report, "$800,000 went to Mr. Haab and two other advisers, Jeffrey Risinger and Tobin Senefeld, in undisclosed fees." The SEC has frozen all accounts related to the scheme.

2001 New York Giants First Round Pick in trouble with SEC

Will Allen, former Giants cornerback, has been sued by the Securities and Exchange Commission (SEC) after allegedly operating a Ponzi scheme. The SEC claims that Allen and his partner carried out the scheme in order to satisfy a $7 million debt. The investors believed that they were making loans to professional athletes and would be earning up to 18% on the loan. However, in reality, a large portion of the investor money was siphoned off to pay the pre-existing personal debt.

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