Securities Lawyers Blog
The investment lawyers of Gana Weinstein LLP are investigating the allegations made by The Financial Industry Regulatory Authority (FINRA) resulting in a bar of broker Norman Ferra Jr. (Ferra) who was previously registered with International Assets Advisory, LLC working out of the Tampa, Florida office. Ferra has 20 years of experience in the securities industry and three disclosures on his record.
In March 2017, Ferra was barred after he consented to the sanction and to the entry of findings that he failed to respond to letters requesting that he produce documents and information in connection with an investigation regarding undisclosed outside business activities and private securities transactions. No other disclosure concerning the extent and nature of the activity is disclosed.
However, Ferra has disclosed several outside business activities including his d/b/a Rockport Global Advisors. Ferra has also disclosed entities including EG Advisory LLC It is unclear at this time what entities Ferra’s outside business activities that were the subject of the FINRA bar involve.
The providing of loans, selling of promissory notes, or recommending investments outside of the firm constitutes impermissible private securities transactions – a practice known in the industry as “selling away”. Often times, brokers sell promissory notes and other investments through side businesses as accountants, lawyers, real estate agents, or insurance agents to clients of those side practices.
Ferra entered the securities industry in 1991. From February 2010 until December 2011, Ferra was associated with R. F. Lafferty & Co., Inc. Then, from January 2012 until October 2012 Ferra was associated with Aegis Capital Corp. From November 2012 until April 2015 Ferra was registered with Merriman Capital, Inc – a firm that was expelled by FINRA in January 2017. Finally, from April 2015 until November 2016 Ferra was associated with International Assets Advisory out of the firm’s Tampa, Florida office location.
In the industry the term selling away refers to when a financial advisor solicits investments in companies, promissory notes, or other securities that are not pre-approved by the broker’s affiliated firm. A brokerage firm’s claim of ignorance of their advisor’s activities is not a proper defense to their agent’s activities. Brokerage firms are obligated under the FINRA rules to properly monitor and supervise its employees in order to detect and prevent brokers from offering investments away from the firm and respond to red flags of potential misconduct. In order to properly supervise their brokers each firm is required to have procedures in order to monitor the activities of each advisor’s activities and interaction with the public. 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.
Investors who have suffered losses may be able recover their losses through securities arbitration. The attorneys at Gana Weinstein LLP are experienced in representing investors in cases of selling away and brokerage firms failure to supervise their representatives. Our consultations are free of charge and the firm is only compensated if you recover.