SunTrust Settles Customers' Claims Of Unauthorized Trading

Daniel Antonio Pacheco (CRD#: 5278626), who was a prior financial advisor of SunTrust Investment Services, Inc. in Hollywood, Florida from January 19, 2016 to April 14, 2016, has disclosed on Financial Industry Regulatory Authority (“FINRA”) BrokerCheck that a customer filed a FINRA Arbitration #17-02124 on September 13, 2017, asserting a claim against Pacheco of unsuitability.

The customer indicated that Pacheco misrepresented the customer’s suitability profile – documentation which generally refers to an investor’s risk tolerance, investment objectives, and financial status. The customer asserted that Pacheco also placed the customer in equities, including common or preferred stock, that were not suitable for the customer. SunTrust and the customer agreed for the customer to be paid $35,000.00 to settle the claim.

At least three other SunTrust customers have come forward disputing Pacheco’s sales practices, according to Pacheco’s FINRA BrokerCheck file. In one customer dispute filed on December 14, 2015, a customer alleged that Pacheco made stock trades in the customer’s account without the customer’s permission. On December 18, 2015, SunTrust settled that customer’s claim of unauthorized trading.

In another customer complaint filed January 15, 2016, Pacheco was accused of providing the customer written confirmation that the customer’s account value would not fall below $485,000.00. Apparently, the promise made by Pacheco was left unfulfilled. The customer also alleged that Pacheco was supposed to have contacted the customer if the customer sustained more than three percent losses on mutual funds and equity investments; however, Pacheco failed to communicate with the customer. On February 24, 2016, SunTrust settled the customer’s dispute by paying $35,000.00 in damages.

Another SunTrust customer filed a complaint on January 22, 2016, claiming that Pacheco made unauthorized trades of stock in the customer’s account. Pacheco was additionally accused of buying securities for the customer’s account that did not match the customer’s risk tolerance. Records show that the customer was provided $28,740.65 by SunTrust on April 18, 2016 to resolve the customer’s allegations of unsuitability and unauthorized trading.

Investors who have lost money by investing with SunTrust financial advisors such as Daniel Antonio Pacheco are welcome to contact the Law Office of Peter M. Spett at (561) 463-2799 for a free consultation regarding their legal rights and claims. Peter M. Spett is experienced at recovering investor losses.

SEC Alleges Morgan Stanley Advisers Committed Securities Fraud

The Securities and Exchange Commission (“SEC”) filed a Complaint in the United States District Court for the District of Massachusetts, charging James S. Polese (CRD #:2636427) and Cornelius Peterson (CRD #: 5769919), both prior investment advisers of Morgan Stanley in Boston, Massachusetts, with defrauding several customers and stealing their assets. The Securities and Exchange Commission vs. James S. Polese and Cornelius Peterson [Case 1:18-cv-10186, Filed January 31, 2018]. The United States Attorney’s Office also filed a parallel action, in which Peterson and Polese were charged with investment adviser fraud, bank fraud, conspiracy and identify theft.

The SEC’s Complaint alleged that between August 2014 and May 2017, Peterson and Polese participated in a fraudulent scheme, part of which involved an elderly client’s $450,000.00 in assets being stolen. Peterson and Polese allegedly misappropriated $350,000.00, where $100,000.00 had been used by them to invest in their personal accounts, with the remainder directed to a bank account controlled by Polese.

The Complaint also stated that between March 2017 and May 2017, a number of unapproved withdrawals totaling $93,000.00 had been executed by Polese from the elderly client’s account to pay Polese’s childrens’ college tuition and Polese’s credit cards.

The Complaint additionally alleged that Peterson and Polese breached fiduciary duties to their customers. Particularly, unbeknownst to customers, Peterson and Polese invested the funds of their customers in investments that Peterson and Polese maintained a financial stake. Peterson and Polese also mysteriously used the assets belonging to a customer to secure a loan for purposes of financing an entity that Peterson and Polese invested in. Further, two customers had been defrauded by Polese when he procured a loan from a customer under terms that were not beneficial to the customer, and charged another customer fees that were 50% greater than what the customer and Polese had previously agreed upon.

The SEC alleged that Peterson and Polese violated Section 10(b) of the Exchange Act; Rule 10b-5; Section 206 of the Advisers Act; and aided and abetted Section 204 of the Advisers Act. SEC sought civil penalties, permanent injunctions and disgorgement of Polese’s and Peterson’s ill-gotten gains.

While Polese’s fate is yet to be determined, on January 31, 2018, Peterson pled guilty to investment adviser fraud, conspiracy, and bank fraud. United States v. Cornelius Peterson, Crim. Information No. 1:18-cr-10027. Subsequently, on July 17, 2018, Peterson consented to the SEC’s Order Instituting Administrative Proceeding Pursuant to Section 15(b) of the Exchange Act and Section 203(f) of the Advisers Act, Making Findings, and Imposing Remedial Sanctions, under which SEC barred Peterson from acting as a broker or investment adviser or associating with firms that sell securities or provide the public with investment advice.

Polese and Peterson have disclosed on FINRA BrokerCheck that customers have filed disputes alleging Polese’s and Peterson’s sales practices violations. On My 26, 2017, two Morgan Stanley Smith Barney customers filed complaints alleging Polese misrepresented fees charged in their managed accounts between January 2015 and May 2017. One of those complaints was settled for $33,260.00 in damage; the other is pending.

On November 7, 2017, a customer filed arbitration #17-02954, alleging that Peterson and Polese misappropriated the customer’s assets. The arbitration is still ongoing. And on May 21, 2018, a Morgan Stanley customer demanded $136,500.00 in damages as a result of Polese’s alleged unauthorized stock trading.

Prior to the SEC’s Complaint, Morgan Stanley discharged Peterson and Polese on June 26, 2017, citing allegations of misappropriation of customer assets. In addition, on September 1, 2017, Financial Industry Regulatory Authority (“FINRA”) barred Peterson and Polese in all capacities for failing to respond to FINRA’s request for their information.

If you believe that you are a victim of investment-related misconduct committed by Cornelius Peterson or James S. Polese, contact the Law Office of Peter M. Spett at (561) 463-2799 for a complimentary consultation to evaluate your legal rights and claims. Peter M. Spett has extensive experience recovering losses for investors.

Customers Allege Oppenheimer Committed Fraud

Gregory Baines Iglow (CRD#: 2783963), who has been a registered representative of Oppenheimer & Co. Inc. (Los Angeles, California), disclosed on Financial Industry Regulatory Authority (“FINRA”) BrokerCheck that he is referenced in a July 11, 2018 FINRA arbitration #18-02493. The Oppenheimer customer raised allegations of negligent supervision, breach of fiduciary duty, breach of contract, common law fraud, omissions, misrepresentation, unsuitability, violation of California’s Elder Abuse statutes, and violation of California Securities Act. The customer’s claims of misconduct pertain to investments in Puerto Rican bonds. A total of $300,000.00 in damages has been alleged by the customer in the pending matter.

According to FINRA BrokerCheck, allegations of Iglow’s sales practice violations are referenced in seven consumer-initiated, investment-related disputes. According to two July 17, 2014 complaints, customers of Oppenheimer alleged that omissions were made about municipal debt investments when they were purchased by the customers. The customers also contended that the investments were inappropriate given the customers’ ages and health conditions. The customers demanded a combined $324,482.90 in damages. Oppenheimer denied the customers’ allegations.

On December 17, 2009, civil suit #BC427035 was filed by an Oppenheimer customer concerning Iglow’s sales practices. Apparently, the customer contended that auction rate securities had been misrepresented, and omissions were made regarding those securities. The customer’s matter was settled for a total of $3,164,250.00 in damages on March 16, 2011.

Additionally, a consumer-initiated arbitration #09-05195 was filed on October 12, 2009. A customer who held assets with RBC Capital Markets Corporation and Oppenheimer accused Iglow of placing the customer in unsuitable corporate bonds. Apparently, the issuer of those bonds filed for bankruptcy, causing the customer to sustain losses. On May 14, 2010, the arbitrator found Iglow liable for negligence, omission of facts, non-disclosure, misrepresentation, breach of fiduciary duty, fraud and unsuitability. The arbitrator ordered Iglow to pay the customer $17,121.00 in damages.

In a March 6, 2009 complaint, an Oppenheimer customer alleged that Iglow was dishonest with the customer in reference to the customer’s Fannie Mae corporate debt investments. The customer’s claim was denied by Oppenheimer on April 15, 2009. Iglow was additionally subject of an April 7, 2003 complaint where a Prudential Securities Incorporated customer claimed that Black Rock Income Municipal Income Trust Fund investments had been misrepresented. Prudential Securities Incorporated denied the customer’s matter on May 16, 2005.

If you have suffered losses as a result of investing with Gregory Baines Iglow or another Oppenheimer broker, call the Law Office of Peter M. Spett at (561) 463-2799 for a free consultation concerning your legal rights and claims. Peter M. Spett has extensive experience recovering investor losses.

Customer Files Suit Against Paulson Investment Company For Securities Fraud

Michael Patrick Nixon (CRD# 2169631), who has been a registered representative of both Newport Coast Securities, Inc. (Leesburg, VA) and Paulson Investment Company, LLC (Tampa, FL), disclosed on Financial Industry Regulatory Authority (“FINRA”) BrokerCheck that he is named in a July 9, 2018 FINRA Arbitration #18-02421 where several customers alleged that Nixon committed securities fraud. The customers are reportedly seeking $3,000,000.00 in damages because of Nixon’s fraudulent activities.

The customers’ claims included the violation of Florida Securities Act and the Virginia Securities Act; a breach of fiduciary duties; unsuitable securities recommendations; inadequate supervision of the transactions effected in the customers’ accounts; and the breach of contractual terms. Apparently, those claims of sales practice violations concerned the customers’ investments in corporate debt products during the period that Nixon was employed by both Paulson Investment Company, LLC and Newport Coast Securities, Inc. The arbitration is pending a resolution.

Another customer arbitration, National Association of Securities Dealers (“NASD”) Arbitration #98-03927 was disclosed on Nixon’s FINRA BrokerCheck file. A customer of American Frontier Financial Corporation (formerly known as RAF Financial Corp.) alleged that Nixon engaged in deceitful conduct; misrepresented information about investments; failed to supervise the customer’s stock transactions; breached fiduciary duties; and violated NASD rules.

Nixon has a history of working for brokerage firms that FINRA has expelled, including Dickinson & Co. (expelled April 7, 1998); Jesup & Lamont Securities Corp. (expelled November 4, 2010); Empire Financial Group, Inc. (expelled March 30, 2009); Meyers Associates, L.P. (expelled May 29, 2018); and Newport Coast Securities, Inc. (expelled June 25, 2018).

Nixon’s employment with Newport Coast Securities, Inc. ended on January 6, 2016. He has been with Paulson Investment Company LLC since December 4, 2015.

If you have suffered losses because of Michael Patrick Nixon, call the Law Office of Peter M. Spett at (561) 463-2799 for a free consultation concerning your legal rights and claims. Peter M. Spett has extensive experience recovering investor losses.

Morgan Stanley Broker Terminated For Alleged Outside Business Activities

Michael Schuchman (CRD :# 4437315), who was registered as a general securities representative of Morgan Stanley between June 1, 2009 and June 14, 2018, has voluntarily resigned based on allegations made by Morgan Stanley concerning Schuchman’s possible engagement in outside business activities without notifying the firm as required by the firm’s policies.

FINRA BrokerCheck disclosed that several of Schuchman’s past customers have filed disputes regarding his sales practices. Most recently, Schuchman has been referenced in a pending consumer-initiated, investment-related arbitration from July 2, 2018 in which the customers alleged that Schuchman excessively traded in their accounts between May 2014 and July 2017, during which time Schuchman was employed by Morgan Stanley Smith Barney. (Case #: 18-02223). The complaint is pending.

Another consumer arbitration regarding Schuchman’s conduct had been filed on August 3, 2017. The arbitration concerned a Morgan Stanley customer who alleged that structured products, exchange-traded funds and equities transactions effected in the customer’s account between 2011 and 2017 were not suitable for the customer. That complaint is pending.

In addition, on December 15, 2014, a consumer brought a complaint alleging that that commissions on options and equity investments had been misrepresented to the customer. The customer’s complaint was resolved on May 11, 2015.

If you have suffered losses due to the sales practice violations of Schuchman or another Morgan Stanley broker or financial adviser, call the Law Office of Peter M. Spett at (561) 463-2799 for a free consultation concerning your legal rights and claims. Peter M. Spett has extensive experience recovering investor losses.

Wells Fargo’s Laura Cava Barred For Disregarding FINRA Requests

Laura Ann Cava (CRD #: 5092233) has been a registered representative of Wells Fargo Clearing Services, LLC (Lehigh Acres, Florida) between April 11, 2006 and May 5, 2017. Financial Industry Regulatory Authority (“FINRA”) barred Cava in all capacities on October 23, 2017, citing allegations that Cava failed to respond to FINRA’s request for information. FINRA may have been inquiring into Cava’s activities for possible violations of FINRA rules.

Particularly, Cava did not leave Wells Fargo Clearing Services on a good note. She was discharged on May 5, 2017 for allegedly violating company policy by borrowing from several banking customers. FINRA Rule 3240 precludes borrowing arrangements between customers and registered representatives absent the borrowing arrangement meeting certain criteria.

FINRA indicated on Cava’s FINRA BrokerCheck page that Cava was suspended in all capacities on August 11, 2017 for failing to respond to FINRA’s request for information. Cava was provided approximately three months to comply with FINRA’s requests or otherwise seek that her suspension be terminated. Since Cava failed to provide FINRA with the required information by October 22, 2017, she was automatically barred on October 23, 2017. (FINRA Action #: 2017054338601)

If you have suffered losses due to the misconduct of your Wells Fargo broker or financial adviser, call the Law Office of Peter M. Spett at (561) 463-2799 for a free consultation concerning your legal rights and claims. Peter M. Spett has extensive experience recovering investor losses.

Merrill Lynch Customers Sue Over Unsuitable Puerto Rican Bonds

Jose E. Gonzalez Pumarada (CRD #: 1571751) is a general securities representative of Merrill Lynch, Pierce, Fenner & Smith Incorporated (Guaynabo, Puerto Rico). FINRA BrokerCheck disclosed that Pumarada is subject of a pending consumer-initiated, investment-related arbitration from October 19, 2017 containing allegations against Pumarada of sales practice violations. The Merrill Lynch customer alleged in the October 19, 2017 arbitration that she was placed in Puerto Rican municipal bonds and closed-end funds that were both unsuitable and misrepresented. At least $250,000.00 in damages has been alleged by the customer. (Case #: 17-02713).

According to FINRA BrokerCheck, allegations of Pumarada’s sales practice violations are referenced in four previous consumer-initiated, investment-related disputes. The first one was a complaint filed by a Salomon Smith Barney customer on February 6, 2001, alleging that the customer’s instructions concerning options investments had not been followed. The customer also alleged that unauthorized options had been purchased for the customer’s account. Salomon Smith Barney denied the complaint on February 6, 2001.

Then, a Merrill Lynch customer filed an arbitration on June 25, 2014, alleging that unsuitable investment recommendations were made concerning the customer’s investments in municipal debt and closed-end funds. Moreover, the customer claimed that there were misrepresentations and omissions of information relating to her investments. Merrill Lynch settled the customer’s complaint for $15,000.00 on March 22, 2016. (Case #: 14-01828)

On September 22, 2015, another customer of Merrill Lynch brought an arbitration alleging omissions and misrepresentations of facts between October 2009 and September 2015 concerning municipal debt and closed-end funds. The customer claimed to have received unsuitable investment recommendations. The arbitration was settled on February 23, 2018 for $50,000.00.

Are you a victim of sales practice violations committed by Jose E. Gonzalez Pumarada or another broker or financial advisor? If so, contact The Law Office of Peter M. Spett at (561) 463-2799 for a free consultation regarding your legal rights and claims.

Customer Alleges National Planning Corporation Provided Poor Advice

Nancy Ellen Biddle (CRD #: 2134532) is a general securities representative who was registered with National Planning Corporation (St. Pete Beach, Florida) between June 19, 2006 and October 24, 2017. FINRA BrokerCheck discloses that Biddle has been subject of consumer-initiated, investment-related complaint from March 17, 2017 containing allegations against Biddle of poor investment advice while registered with National Planning Corporation. The customer alleged that Biddle made unsuitable recommendations concerning the purchase and liquidation of real estate investment trusts, causing the customer to experience damages exceeding $5,000.00.

According to FINRA BrokerCheck, this is the fifth consumer-initiated, investment-related dispute in which Biddle’s sales practices have been called into question. The first complaint was filed by a customer of Locus Street Securities who alleged that real estate investment trust purchases were not suitable given the customer’s age and liquidity needs. In addition, that customer alleged that the account was over-concentrated in real estate investment trusts. The complaint was settled on February 25, 2005 for $171,668.40 in damages.

The second complaint was filed on May 2, 2006, concerning a customer of ING Financial Partners, Inc. who alleged that there were unauthorized stock trades made in the customer’s investment account. The customer demanded $150,000.00 in damages. ING Financial Partners, Inc. denied the complaint on May 11, 2006. The third complaint dated May 9, 2013 involved a National Planning Corporation customer who alleged that a variable annuity was unsuitable for the customer. The firm stated that the customer’s alleged damages are greater than $5,000.00.

Another National Planning Corporation customer brought an arbitration on July 14, 2015, alleging negligence, breach of contract, breach of fiduciary duty and violation of FINRA and NASD rules in connection with the customer's real estate security holdings. National Planning Corporation agreed to pay the customer $12,500.00 to resolve the matter.

On October 18, 2017, Biddle became registered with FSC Securities Corporation in St. Pete Beach, Florida.

If you have incurred investment losses from Nancy Ellen Biddle, call the Law Office of Peter M. Spett at (561) 463-2799 for a free consultation concerning your legal rights and claims. Peter M. Spett has extensive experience recovering losses for investors who have been sold unsuitable securities by their brokers or advisors.