Securities Lawyers Blog
Our firm is investigating claims made by various regulators and brokerage firms including Axiom Capital Management, Inc. (Axiom) and Financial West Group (FWG) concerning broker Sara Eng (Eng a/k/a Sara Aiping Ng). Eng is currently associated with brokerage firm Moloney Securities Co., Inc. (Moloney).
The allegations revolve around Eng’s offering of investments to clients. In October 2015, FWG terminated Eng for cause and allowed Eng to voluntarily resign after allegations were made that Eng was being placed on heightened supervision for potential violation of firm policy regarding marketing of investments to firm customers. Thereafter, in September 2016, Axiom terminated Eng for cause for violation of the firm’s policies and procedures regarding email correspondence. At the same time The Financial Industry Regulatory Authority’s (FINRA) opened its own investigation into Eng concerning Axiom’s disclosures for Eng’s termination. At this time it is unclear the exact nature and extent of the investigation.
Eng entered the securities industry in 1997. From November 2002 until March 2014, Eng was associated with Berthel, Fisher & Company Financial Services, Inc. From February 2014 until November 2015, Eng was associated with FWG. From October 2015 until September 2016, Eng was registered with Axiom. Finally, since November 2016 Eng has been registered with Moloney out of the firm’s Oak Brook, Illinois and Flushing, New York office locations.
Brokers in the financial industry have the fundamental responsibility to treat investors fairly. This obligation includes making only suitable investments for their client. The suitable analysis has certain requirements that must be met before the recommendation is made. First, there must be reasonable basis for the recommendation for the investment based upon the broker’s and the firm’s investigation and due diligence. Common due diligence looks into the investment’s properties including its benefits, risks, tax consequences, the issuer, the likelihood of success or failure of the investment, and other relevant factors. Second, if there is a reasonable basis to recommend the product to investors the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives. These factors include the client’s age, investment experience, retirement status, long or short term goals, tax status, or any other relevant factor.
The number of events listed on Eng’s brokercheck is high relative to her peers. According to InvestmentNews, only about 12% of financial advisors have any type of disclosure event on their records. Brokers must publicly disclose certain types of reportable events on their CRD including but not limited to customer complaints. In addition to disclosing client disputes brokers must divulge IRS tax liens, judgments, and criminal matters. However, FINRA’s records are not always complete according to a Wall Street Journal story that checked with 26 state regulators and found that at least 38,400 brokers had regulatory or financial red flags such as a personal bankruptcy that showed up in state records but not on BrokerCheck. More disturbing is the fact that 19,000 out of those 38,400 brokers had spotless BrokerCheck records.
Gana Weinstein LLP’s securities fraud attorneys represent investors who have suffered securities losses due to the mishandling of their accounts due to claims of fraud and negligence. The majority of these claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.