Michael Roger Griffith of Middle River, Maryland was barred from the securities industry by the Financial Industry Regulatory Authority (FINRA). Griffith was accused of allegedly submitting an unauthorized life insurance application and setting up unauthorized automatic withdrawals from the customer's bank account to fund the policy. Once the customer discovered the unauthorized debits, the firm was alerted and the money was returned.
Michael Oppenheim, an ex JP Morgan broker, was sentenced to five years after stealing over $20 million of his client's money. At one point, Oppenheim was a successful broker managing 500 clients with combined assets of $90 million. Oppenheim is now claiming, according to an Investment News article, that his brain was 'hijacked' by a sports gambling addiction. The U.S. District judge presiding over the case gave him five years, instead of the ten years the prosecutors requested. Oppenheim pleaded guilty in November 2015.
Claus Foerster, a financial advisor from South Carolina, has been indicted on fraud charges. Mr. Foerster was barred by FINRA from the securities industry in 2014 after allegations that he was running a Ponzi scheme. Foerster allegedly ran the Ponzi scheme for 14 years and was able to defraud his clients out of $2.8 million. Foerster perpetuated the Ponzi scheme by providing his clients with fictitious account statements. The Ponzi scheme began while Foerster was a financial advisor employed by Smith Barney and continued through his employment with Raymond James. Raymond James terminated Foerster when they learned of the fraud and made restitution to the clients that were involved in Foerster's scheme.
Last month the pop music icon Prince died a sudden and untimely death at the age of 57. During the course of his career, Prince amassed a massive estate that includes the rights to his music catalog and unreleased music reportedly worth more well over $300 million. Prince did not make a will prior to his death. A comprehensive estate plan could have significantly reduced his estate's tax liability and controlled the release of his unpublished music after his death. In addition, and arguably more importantly, Prince's estate is facing costly and time-consuming litigation that likely would have been avoided if he had made a will.
A Purshe Kaplan investment advisor, Gopi Krishna Vungarala, has been charged by FINRA for lying to his customer, a Native American tribe, in connection with the sale of $190 million worth of non- publicly traded REIT investments. FINRA alleges that Mr. Vungarala's firm eared $11 million in commissions on the sales.
Alternative fund manager Equinox Fund Management, LLC recently settled charges with the Securities and Exchange Commission (SEC). The SEC alleged that Equinox misrepresented and misled investors about a specific fund named The Frontier Fund (TFF). The SEC alleged that Equinox misrepresented the amount of management fees it charged. As a result of the SEC allegations, Equinox agreed to refund its investors about $5.4 million plus $600,000 in prejudgment interest. The SEC has also imposed a $400,000 fine.
A FINRA arbitration panel awarded investors $1.9 million in compensatory and punative damages against a broker-dealer named NSM Securities, Inc., and its founder, Niyukt Raghu Bhasin. The investors claimed the firm churned their accounts. The firm has been barred from any membership or association with FINRA. Mr. Bhasin was barred from the securities industry in January 2015.
A couple in North Carolina recently filed a statement of claim against Morgan Stanley due to investment losses in an energy investment named Morgan Stanley Cushing MLP High Income ETN. The couple are claiming that they lost over $100,000 of the $150,000 they had invested. This investment has been struggling since the second half of 2014 when oil prices in the United States declined. The couple is alleging that Morgan Stanley breached its fiduciary duties and committed fraud.
Miguel Ortiz, a New York financial advisor, was barred from the securities industry by FINRA after allegations of fraud. FINRA claims that Ortiz falsified account statements and concealed the account value of a joint account held by his one of his customers. The victims believe that they lost $162,843 due to Ortiz's misrepresentations. Ortiz was also reprimanded for failing to disclose a $4.9 million civil judgment against him on his Form U-4. Ortiz has appealed FINRA's findings.
Charles J. Broida, an attorney from Columbia, Maryland, pleaded guilty to stealing over $28,000 from a client. Broida received a six month suspended jail sentence and was ordered to complete 300 hours of community service. The state's attorney charged Broida with one count of theft. Broida, in connection with his representation of an estate, stole investment dividends instead of distributing the dividends to the widow of the decedent. The widow thought that the dividend checks were going into an account that would be reassigned to her, but found out later that she had no access to the account or funds. Shortly after her discovery, she filed a complaint with the Maryland Attorney Grievance Commission.