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January 2015 Archives

Financial Author, Sherwin Brown, Indicted by SEC

After receiving a fine of more than $1.3 million in 2010, Sherwin Brown was barred from the securities industry. The Securities and Exchange Commission (SEC) recently indicted Brown, alleging that after his disbarment he had continued to act as a "money coach." The SEC alleges that Brown was charging clients for his financial advice. From the time that Brown was barred in 2011 until May 2014, Brown allegedly deposited $330,000 worth of clients' checks into his account.

Paul Greenwood Receives 10 Year Sentence

Paul Greenwood, a former co-owner of the New York Islanders, was sentenced to ten years in prison on fraud charges. From 1996 through the beginning of 2009, Greenwood and his business partner, Stephen Walsh, used the businesses that they operated, Westridge Capital Management Inc. and WG Trading Co. LP, to swindle funds from investors. The men allegedly cheated institutional investors out of more than a half-billion dollars. Greenwood used the money for a teddy bear collection, a controlling interest in the New York Islanders, and numerous other personal expenditures.

Former NBA Player Scores Arbitration Award

Former NBA player, Sam Young, was awarded $2 million after allegedly being defrauded by his broker, Jinesh "Hodge" Brahmbhatt. The fraud began in 2012 when Brahmbhatt advised Young to invest in unregistered promissory notes. The worthless notes were issued by CFP Group Inc. and also Success Trade Securities, Inc. Brahmbhatt had worked at Success Trade Securities, Inc. in Washington, D.C.

LPL Broker Ordered to Pay $2 million after Defrauding Clients

After allegedly bilking clients of almost $1.7 million, Blake B. Richards, a former LPL broker, was ordered to pay $2 million by Judge Willis B. Hunt, Jr. The Securities and Exchange Commission (SEC) first announced the charges against Richards in the summer of 2012. The SEC believes that Richards began advising at least seven clients to invest into funds and entities that he controlled. The investors were told that their funds would be reinvested into conservative investments, but in reality it was going to Richards to pay his own personal expenses. Richards allegedly kept up scam by creating fake statements for each of the clients. LPL has commented that they began an investigation and terminated him after another advisor had tipped the company off. In June 2013, shortly after he was terminated, Richards was also barred from the securities industry by the Financial Industry Regulatory Authority.

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