Problem Brokers

FINRA Bars Chicago Broker George E. Johnson Over Allegations of Fraud and Stock Manipulation

February 24, 2016 | Malecki Law Team

The Financial Industry Regulatory Authority (FINRA) has announced that it barred broker George E. Johnson from the securities industry for allegedly engaging in manipulation of stock trading, and for committing fraud. FINRA also imposed a 6-month suspension against a second broker, Joseph Mahalick, and a 2 year suspension against a supervisor, Christopher Wayne. All three individuals are reported to have worked at the time for the brokerage firm Meyers Associates, L.P. out of the firm’s Chicago, Illinois office. Mr. Johnson has been working for and was registered by Newport Coast Securities, Inc. from April 2013.

FINRA’s Order stated that during May 2012, Mr. Johnson manipulated the market for the common stock of IceWEB, Inc. (OTCBB: IWEB) by soliciting customers to buy the stock while also soliciting other customers to sell at increasingly higher and artificially inflated prices and frequently effecting matched orders among his own customers. Before and during this time, FINRA’s Order set forth that Mr. Johnson distributed to his clients misleading research and sales materials concerning IWEB, and failed to disclose material information.

The Order alleged that Mr. Johnson first became involved with IWEB when his employer acted as a placement agent for the company, and that he continued to recommend the stock to his clients through private placements and in the open market, despite the company having years of financial issues. At the time, IWEB stock was valued at around .12/share, and the Order alleged that Mr. Johnson solicited purchases and sales in the stock to artificially increase the share price to .17/share, allegedly for the purpose of earning placement agent business from IWEB to earn substantial placement fees.

BROKER REPORT: M&T Securities Financial Advisor Christopher T. Fenton

January 26, 2016 | Malecki Law Team

The securities fraud attorneys at Malecki Law are interested in hearing from investors who have complaints against stockbroker Christopher T. Fenton. Mr. Fenton is currently employed and registered with M&T Securities, Inc., a broker-dealer, working out of the Buffalo, New York office, according to his publicly available BrokerCheck, as maintained by the Financial Industry Regulatory Authority. He was also previously registered with Pruco Securities Corporation.

According to his BrokerCheck report, Mr. Fenton has been the subject of three customer complaints while employed by M&T Securities, Inc. The latest customer complaint led to a FINRA arbitration proceeding, according to BrokerCheck records. The BrokerCheck records reveal that the customer alleged that misrepresentations, breach of fiduciary duty and recommendation of unsuitable investments were made. The dispute resulted in an award to the customer, according to the BrokerCheck report.

A review of the award, publicly available from FINRA’s website, discloses that the claimant also alleged that the causes of action related to an M&T Portfolio Architect Account and Rochester Fund Municipals. The award also disclosed that Mr. Fenton and his firm were found to be jointly and severally liable to the claimant for the award, as well as a portion of fees the claimant incurred in bringing the claim.

BROKER REPORT: John Keyser of Dawson James Customer Complaints

January 20, 2016 | Malecki Law Team

The securities and investment fraud attorneys at Malecki Law are interested in hearing from investors who have complaints against Florida stockbroker John T. Keyser. Mr. Keyser is reportedly registered with Dawson James Securities, Inc. in Boca Raton, Florida. Industry records indicate that Mr. Keyser has also recently been registered with Viewtrade Financial and SAL Financial Services.

According to BrokerCheck, as maintained by the Financial Industry Regulatory Authority (“FINRA”), Mr. Keyser has been the subject of three customer complaints and a suspension of his license.

In 1998, Mr. Keyser reportedly had his FINRA (then NASD) license to sell securities suspended for failing to pay an arbitration award against him.

Jenice Malecki Featured in today’s FundFire Story Involving Morgan Stanley

January 15, 2016 | Malecki Law Team

Today, Ms. Malecki was extensively quoted in the FundFire story titled MSWM Goes to Court to Get Former FA to Pay Back Loans.

This story is focused on Morgan Stanley’s attempt to go to court to make a former advisor pay-up after FINRA arbitrator granted them a million dollar reward in a promissory note dispute case. Ms. Malecki, who has extensive and relevant experience with securities industry employment dispute cases opined that “it is common for wirehouses to pursue awards through FINRA arbitration when advisors leave the firm but don’t repay outstanding promissory notes” and this happens more often when markets are bad. The detailed story is available on the FundFire website at http://bit.ly/1ZAPssh

Broker Report: David H. Bindelglass of Morgan Stanley

December 12, 2015 | Malecki Law Team

The investment fraud attorneys at Malecki Law are investigating potential claims by investors against Morgan Stanley stockbroker David H. Bindelglass. According to his BrokerCheck report maintained by the Financial Industry Regulatory Authority (“FINRA”), Mr. Bindelglass, who works out of Morgan Stanley’s Paramus, New Jersey branch, has been the subject of at least three customer complaints.

Mr. Bindelglass is believed to have regularly recommended investments in Puerto Rican bonds to his clients. It is believed that Mr. Bindelglass may have recommended such investments in high concentrations. In high concentrations, even investments believed to be “safe” can be unsuitable and result in significant losses. If a financial advisor recommends investments in a concentration that is unsuitable, the investor may be entitled to recover some or all of their losses.

According to FINRA records, since 2006, Mr. Bindelglass has been accused by at least three different customers of recommending unsuitable investments. In each case, FINRA records indicate that those investors were able to recover for their losses.

PIABA Study Reveals that FINRA’s Effort to Curb Broker Record-cleansing Has Not Been Met With Success

October 26, 2015 | Malecki Law Team

According to Public Investors Arbitration Bar Association’s (PIABA) latest report, FINRA’s efforts to curb broker expungement and clear records of misconduct have failed to reduce the number of times it occurs. According to PIABA, between, 2012-14 expungement was granted in 87.8% of cases in which it was sought.

When brokers are granted expungement for alleged wrongdoings, this record is wiped out from FINRA’s BrokerCheck and FINRA is concerned that it might cause an impression about the broker’s ethic that is misleading.

Since 2014, FINRA has increased arbitrator guidance and training and introduced rules that prohibit arbitration settlements with expungement as a condition. FINRA has sought to grant expungement as an “extraordinary remedy” only to be available in cases where the broker’s record has no value for investor protection. FINRA’s arbitration task force is considering creating a Special Arbitration Panel comprised of specially trained arbitrators to make decisions on expungement requests.

BROKER REPORT: Timothy L. Pilkington Is Barred from the Securities Industry

October 9, 2015 | Malecki Law Team

The securities fraud attorneys at Malecki Law are interested in hearing from investors who have complaints against stockbroker Timothy L. Pilkington. Mr. Pilkington was employed and registered with Stephens, a broker-dealer with an office in Memphis Tennessee from January 2012 through March 2015, according to his publicly available BrokerCheck, as maintained by the Financial Industry Regulatory Authority (FINRA). He was also previously registered with Morgan Stanley Smith Barney, according to industry records.

According to his BrokerCheck, Mr. Pilkington was the subject of one customer complaint in 2009. More recently, a Letter of Acceptance, Waiver and Consent (AWC) was accepted by FINRA stating that Mr. Pilkington was barred from associating with any broker-dealer for failing to respond to the FINRA 8210 request for information. 8210 Requests require that people registered to recommend and sell securities must provide documents, testimony and information regarding matters under investigation. According to the AWC, Mr. Pilkington failed to disclose two FDIC orders to FINRA. One of those orders disclosed that Mr. Pilkington agreed to pay $2,500, where “the FDIC considered the matter and determined it had reason to believe that the [he] has engaged or participated in violations of law, unsafe or unsound banking practices and/or breaches of fiduciary duty.” In another FDIC order, Mr. Pilkington was “prohibited from participating in the conduct of affairs of, or exercising voting rights in, any insured institution without the prior written approval of the FDIC.”

If you or a family member lost money that was invested with Mr. Pilkington, you are encouraged to contact the securities fraud lawyers at Malecki Law for a free consultation and case evaluation at (212) 943-1233.

BROKER REPORT: Robert Emmet Gill Is Fined $5,000 and Suspended from the Securities Industry for 30 Days

October 7, 2015 | Malecki Law Team

The securities fraud attorneys at Malecki Law are interested in hearing from investors who have complaints against stockbroker Robert Emmet Gill. Mr. Gill is employed and registered with Chelsea Financial Services, a broker-dealer with an office in Tinton Falls, New Jersey, according to his publicly available BrokerCheck, as maintained by the Financial Industry Regulatory Authority (FINRA). He was also previously registered with J.P. Turner & Company, LLC, Grayson Financial, LLC, M.S. Farrell & Company, Inc. and Investors Associates, Inc. Grayson and Investors Associates were expelled from FINRA in 2006 and 1998, respectively.

According to his BrokerCheck report, a Letter of Acceptance, Waiver and Consent (AWC) was accepted by FINRA stating that Mr. Gill was fined $5,000 and suspended from associating with any broker-dealer for borrowing $100,000 from a customer without notifying his then-employer J.P. Turner & Company, in violation of industry rules. Mr. Gill’s BrokerCheck report also discloses that he was “permitted to resign” from J.P. Turner based on the same allegations as those set forth in the AWC.

Mr. Gill’s BrokerCheck report sets forth that he was the subject of four customer disputes involving allegations of unsuitable investment recommendations, misrepresentations made and churning. Three of those four disputes resulted in settlements of $700,000 (with Mr. Gill contributing $50,000 personally), $32,500 and $35,610, respectively, according to industry records.

BROKER REPORT: Jeffrey G. Lyon, formerly of Joseph Gunnar & Co.

October 2, 2015 | Malecki Law Team

The securities fraud attorneys are interested in hearing from investors with complaints involving Jeffrey G. Lyon. Per his BrokerCheck Report, maintained by the Financial Industry Regulatory Authority (“FINRA”), Mr. Lyon is no longer a registered stock broker. Per BrokerCheck, Mr. Lyon was last licensed to sell investments through FINRA in 2013 when he was registered with Joseph Gunnar & Co LLC.

Mr. Lyon’s BrokerCheck Report also indicates that he has been the subject of at least two customer complaints in his final three years in the brokerage industry. Per FINRA, the complaints against Mr. Lyon have alleged unsuitable investment recommendations and unauthorized trading.

In addition to Joseph Gunnar & Co., Mr. Lyon has also reportedly been registered with Charles Vista LLC and John Thomas Financial. Both of these firms were expelled by FINRA in 2014 and 2013, respectively, per FINRA records.

BROKER REPORT: Rudolf Malebranche Is Fined $5,000 and Suspended from the Securities Industry for Three Months

October 1, 2015 | Malecki Law Team

The securities fraud attorneys at Malecki Law are interested in hearing from investors who have complaints against stockbroker Rudolf Malebranche. Mr. Malebranche was employed and registered with Santander Securities LLC. He was previously registered with J.P. Morgan Securities LLC, Chase Investment Securities Corp., Wachovia Securities, Morgan Stanley DW, Inc., Prudential Securities, Inc. and Whale Securities Co., L.P., according to his publicly available BrokerCheck, as maintained by the Financial Industry Regulatory Authority (FINRA).

According to his BrokerCheck report, a Letter of Acceptance, Waiver and Consent (AWC) was accepted by FINRA stating that Mr. Malebranche was fined $5,000 and suspended from associating with any broker-dealer for three months as a result of submitting a switch form, which authorized the sale of two mutual funds, after himself filling in the customer’s initials on the form without the authorization from the client. As a result of this conduct, Mr. Malebranche was also discharged from employment with J.P. Morgan Securities LLC, according to industry records.

Mr. Malebranche also was the subject of a customer complaint alleging unsuitability in connection with the sale of a fixed annuity, resulting in $15,892.28 repaid to the customer (more than the $15,650 requested), according to the BrokerCheck report.