Securities Lawyers Blog
The law offices of Gana Weinstein LLP are currently investigating claims that Broker Kurt Berry (Berry) has been accused by investors of engaging in fraudulent misappropriation of their funds. According to records kept by The Financial Industry Regulatory Authority (FINRA), it appears that Berry was employed by Vanderbilt Securities, LLC at the time of the activity. If you have been a victim of Berry’s alleged misconduct our firm may be able to assist you in recovering funds.
FINRA BrokerCheck shows a final customer complaint on June 17, 2024.
Without admitting or denying the findings, Berry consented to the sanctions and to the entry of findings that he participated in private securities transactions involving customers without providing prior written notice to his member firms or receiving approval from them. The findings stated that Berry’s customers invested $517,410 in oil and gas wells through a series of securities offerings. These customers were all either pre-existing clients or family members of existing clients of Berry’s advisory firm. Berry met with and made each customer aware of the oil and gas securities offerings, discussed the investments with each customer, and introduced each customer to a colleague who had visited some of the oil and gas wells to conduct due diligence. For each of the customers, Berry received $2,000, totaling $8,000.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $473,000.00 on November 14, 2023.
When making the initial recommendations, Respondents affirmatively represented to Claimants that the investments were ‘safe’ and consistent with their investment objectives of generating income with the ability to preserve principal. As set forth above, at the Claimants’ stage of life, they were not in a position to recover money loss. To this end, Respondents represented that the Resolute/Petrorock Investments were non-correlated alternatives to the stock market, which would not experience volatility. Respondents further touted the so-called tax benefits of investing in oil and gas securities structured like the Resolute/Petrorock Investments. Respondents never balanced the presentation with a discussion of risks. They downplayed the boilerplate disclosure language that appeared in the offering documents as mandatory disclosure language that would have no application.
We have a strong track record of advocating for victims of fraud when advisors obtain loans from clients or engage in securities sales via OBAs. The sale of unapproved investment products, fake investments that cover misappropriated funds, and other fraudulent behavior – is a practice known in the industry as “selling away” – a serious violation of the securities laws. The industry defines “selling away” as a practice where a financial advisor offers investments in securities, companies, or promissory notes that have not been authorized by their brokerage firm. Some of these investments may appear legitimate, but they often lead to Ponzi schemes or advisors engaging in fund misappropriation.
However, federal securities laws and the FINRA rules require firms to monitor and supervise its employees in order to detect and prevent brokers from offering investments in this fashion. Each firm is obligated to enforce measures that oversee brokers by monitoring advisors’ conduct and their interactions with clients. Selling away misconduct often occurs where brokerage firms either fail to put in place a reasonable supervisory system or fail to actually implement that system. Supervisory failures allow brokers to engage in unsupervised misconduct that can include all manner improper conduct including selling away.
In cases of selling away the investor is unaware that the advisor’s investments are improper. In many of these cases the investor will not learn that the broker’s activities were wrongful until after the investment scheme is publicized, the broker is fired or charged by law enforcement, or stops returning client calls altogether.
Berry has been in the securities industry for more than 19 years. Berry has been registered as a Broker with Vanderbilt Securities, LLC since 2019.
Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. At Gana Weinstein LLP, our attorneys are experienced representing investors who have suffered securities losses due to the mishandling of their accounts. Claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.
