Securities Lawyers Blog

Aegis Capital Accused of Harming Investors Out of at Least $5 Billion

July 13, 2024 | by Staff Attorney

The securities lawyers of Gana Weinstein LLP are investigating claims made by SLCG Economic Consulting LLC that Aegis Capital, a broker-dealer, routinely serves as underwriter for dubious stock offerings that cost investors billions. SLCG starts off by calling Aegis one of the worst retail brokerage firms based on complaints and a firm that investors should avoid it at all costs. Our firm has represented a large number of investors in claims against the firm over the years.

SLCG claims that since 2010, Aegis has been the sole underwriter of 186 offerings for 111 issuers totaling $1.9 billion. The article further claims that Aegis underwrites stocks issued by small companies on the verge of delisting or bankruptcy and that Aegis’s underwriting peddles worthless stock to its customers and to the customers of other brokerage firms. SLCG further claims that Aegis provides inflated research analyst coverage for many of the stocks it underwrote and aggressive buy recommendations with unrealistic price targets.

SLCG also provided statistics to back up its findings stating:

Advisor Raul Benitez Has Suitability Customer Complaints

February 11, 2024 | by Staff Attorney

The attorneys at Gana Weinstein LLP are investigating BrokerCheck records reports that financial advisor Raul Benitez (Benitez), formerly employed by Wells Fargo Clearing Services , LLC (Wells Fargo) has been subject to at least six customer complaints and one termination for cause during the course of his career. According to records kept by The Financial Industry Regulatory Authority (FINRA), Benitez’s customer complaints alleges that Benitez recommended un suitable investments in various investments and makes allegations including common law fraud, gross negligence.

In January 2024 a customer complained that Benitez violated the securities laws by alleging that Benitez made unsuitable investments and misrepresentations of recommendations in September 2014 and March 2015. The claim alleges $500,000 in damages and is currently pending.

In November 2023 a customer complained that Benitez violated the securities laws by alleging that Benitez made an investment recommendation that was unsuitable. The claim alleges $500,000 in damages and is currently pending.

In July 2021 a customer complained that Benitez violated the securities laws by alleging that Benitez made an investment recommendation in NorthStar that was unsuitable. The claim alleged $2178,707 in damages and settled for $175,000.

Advisor Kieth Baron Sanctioned By Regulator Over Undisclosed Securities Dealings – Investor Recovery Options

February 11, 2024 | by Staff Attorney

The law offices of Gana Weinstein LLP are currently investigating claims that advisor Kieth Baron (Baron) has been accused by The Financial Industry Regulatory Authority (FINRA) of engaging in undisclosed outside business activities (OBAs) and private securities transactions. According to records kept by FINRA, Baron was last employed by Equity Services, Inc. (Equity Services) through January 2022. According to BrokerCheck, Baron has 11 disclosures on his record including two regulatory actions, two financial disclosures, one employment termination, and six customer complaints. If you have been a victim of Kieth’s alleged misconduct our firm may be able to assist you in recovering funds.

According to FINRA, Baron was named in a FINRA complaint alleging that he made material misrepresentations to investors in connection with his recommendation of a Company stock. The FINRA complaint alleges Baron failed to disclose to the couple that he was a consultant for the Company. FINRA is also claiming that Baron later made additional material false statements to an investor in connection with a buyback of the couple’s shares of the Company.

The complaint also alleges that Baron had an ongoing business relationship with Company A. Baron expected to receive compensation and received $284,890 in compensation from Company A. FINRA found Baron failed to provide prior written notice to his member firm concerning his business relationship with Company A. The complaint further alleges that Baron participated in private securities transactions by recommending investors purchase 4,348,000 shares of Company A’s common stock for $359,806. According to FINRA, Baron failed to provide written notice to his firm of his role in the sale of Company A’s common stock prior to participating in the sale.

Advisor Robert Lorente Has Alternative Investment Complaints

February 6, 2024 | by Staff Attorney

Advisor Robert Lorente (Lorente), formerly employed by brokerage firm Aurora Securities (Aurora), has been subject to at least two customer complaints during the course of his career. According to a BrokerCheck report the customer complaints concern alternative investments such as direct participation products (DPPs) like business development companies (BDCs), non-traded real estate investment trusts (REITs), oil & gas programs, and private placements. The attorneys at Gana Weinstein LLP have represented hundreds of investors who suffered losses caused by these types of high risk, low reward products.

In October 2023 a customer complained that Lorente violated the securities laws by alleging that Lorente made unsuitable investments on three REITs purchased in 2019 (February through April). The complaint alleges various claims including negligence, misrepresentation/omission, common law fraud, breach of contract and fiduciary duty. The claim involves a real estate security and alleges $250,000 in damages and is currently pending.

In April 2021 a customer complained that Lorente violated the securities laws by alleging that Lorente engaged in negligence, gross negligence, misrepresentations and omissions, breach of contract relating to investment made in July 2016. The claim involves a real estate security and alleged $35,000 in damages and settled for $12,000.

DDPs include products such as non-traded REITs, oil and gas offerings, equipment leasing products, and other alternative investments. These alternative investments virtually never profit investors and are almost always unsuitable for investors because of their high fee and cost structure. Brokers selling these products are paid additional commission in order to hype these inferior quality investments providing a perverse incentives to create an artificial market for the investments.

Several studies have confirmed that Non-traded REITs underperform publicly traded REITs with some showing that Non-Traded REITs cannot even beat safe benchmarks, like U.S. treasury bonds. Brokers selling these products must disclose to the investor that non-traded REITs provide lower investment returns than treasuries while being high risk and illiquid – but almost never do. Because investors are not compensated with additional return in exchange for higher risk and illiquidity, these kinds of alternative investment products are rarely, if ever, appropriate for investors.

Truist Investment Advisor Kultar Bindra Has Structured Products Complaint

February 6, 2024 | by Staff Attorney

The attorneys at Gana Weinstein LLP are investigating BrokerCheck records reports that financial advisor Kultar Bindra (Bindra), currently employed by Truist Investment Services, Inc. (Truist) has been subject to at least two customer complaints during the course of his career. According to records kept by The Financial Industry Regulatory Authority (FINRA), Bindra’s customer complaint alleges that Bindra recommended unsuitable investments in structured products and makes allegations concerning the misrepresentation of the product among other allegations of misconduct relating to the handling of their accounts.

In August 2023 a customer complained that Bindra violated the securities laws by alleging that Bindra recommended an investment made on July 28, 2020 was misrepresented regarding the term and rate of return. The claim alleges damages and settled for $14,954.

Structured products are a class of derivative products that derive their performance from market linked data. A structured product generally references a source against which market risk is taken. The source can be a single security, a basket of securities such as a market index, commodities, interest rates, or a real estate loan portfolio. The variety of products that can be structured demonstrates the difficulty in formulating a single unified definition of a structured product.

Gana Weinstein Represents Victims of Financial Advisor Stewart Ginn

February 5, 2024 | by Staff Attorney

The attorneys at Gana Weinstein LLP are currently representing victims of financial advisor Stewart Ginn (Ginn), currently employed by Independent Financial Group, LLC (IFG). BrokerCheck records reports that Ginn has been subject to at least six customer complaints during the course of his career and one pending regulatory action. According to records kept by The Financial Industry Regulatory Authority (FINRA), Ginn’s customer complaint alleges that Gin engaged in excessive trading or churning of investor accounts among other allegations of misconduct relating to the handling of their accounts.

On October 17, 2023 FINRA named Ginn as a respondent in a complaint alleging that he churned and excessively traded customer accounts. FINRA alleges that none of the customers was an aggressive investor, one of the customers was in her late 80s and suffering from a cognitive disability; a second retired customer was in her late 70s; and a third retired customer was between 69 and 71 years old. FINRA found that Ginn engaged in frequent in-and-out trades in the customer accounts, while charging high commissions on both buys and sells. According to the complaint, Ginn’s trading caused the customers to incur realized losses of more than $2.22 million, while generating more than $2.24 million in commissions for Ginn and his member firm.

Advisor Wenjinn Chang Has Alternative Investment Complaints

February 5, 2024 | by Staff Attorney

According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) broker Wenjinn Chang (Chang), currently associated with Independent Financial Group, LLC (IFG), has been subject to at least two customer complaints during his career. Those complaints against Chang allege that Chang recommended unsuitable investments in various investments among other allegations of misconduct relating to the handling of their accounts.

In February 2020, a customer complained that Chang violated securities laws by alleging that Chang engaged in negligent investment advice, breach of fiduciary duty, breach of contract, and fraud. The claim alleged $128,000 in damages and settled for $85,000.

In October 2018, a customer complained that Chang’s recommendations of an over-concentration in non-traded REIT’s was unsuitable. The claim alleged $50,000 in damages. The claim settled for $32,500.

Advisor Michael Sandberg Accused of Unsuitable Investment Practices

February 4, 2024 | by Staff Attorney

According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) broker Michael Sandberg (Sanberg), currently associated with Ameriprise Financial Services, LLC (Ameriprise), has been subject to ten customer complaints and one regulatory action during his career. Several of those complaints against Sandberg allege that Sandberg recommended unsuitable investments in various investments among other allegations of misconduct relating to the handling of their accounts.

In December 2020, a customer complained that Sandberg violated the securities laws by alleging that Sandberg engaged in negligent investment advice, breach of fiduciary duty, breach of contract, and fraud. The claim alleges $100,000 in damages and is currently pending.

Brokers are required under the securities laws to treat their clients fairly. This obligation includes the duties to disclose material risks of the investments they recommend and to present products, particularly complex or confusing products, in a fair and balanced manner that allows the client to evaluate the recommendation. Another important obligation advisors have is to make only suitable recommendations for investments to the client.

Advisor Barbara Shaffer Had Customer Complaints Relating to GPB

February 4, 2024 | by Staff Attorney

According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA), advisor Barbara Shaffer (Shaffer), currently employed at Cambridge Investment Research, Inc. (Cambridge), has been subject to at least four customer complaints during the course of her career. Several of those complaints against Shaffer allege that Shaffer engaged in authorized trading and recommended unsuitable investments, including into the GPB Ponzi scheme among other allegations of misconduct relating to the handling of their accounts. However, three of these complaints have been expunged from Shaffer’s record under FINRA’s notoriously flawed expungement procedures.

In January 2020, a customer complained that Shaffer violated securities laws by alleging that Shaffer engaged in negligent investment advice and breach of fiduciary duty. The claim alleged $100,000 in damages and settled for $45,000.

In another complaint, the customer alleged unsuitability and breach of fiduciary duty against focused on a $100,000 investment in GPB Automotive Fund, L.P. The GPB funds were later accused of being a Ponzi Scheme by many regulators and its executive officers have been indicted by the DOJ.

Advisor Byron Treat Permanently Barred From Industry Over Sale of Church Bonds

January 22, 2024 | by Staff Attorney

The law offices of Gana Weinstein LLP are currently investigating claims that advisor Byron Treat (Treat) has been accused by a securities regulator of failing to supervise recommendations of certain illiquid investments. Treat was sanctioned by The Financial Industry Regulatory Authority (FINRA) concerning whether Treat reasonably supervised the sale of certain illiquid investment. According to records kept by The Financial Industry Regulatory Authority (FINRA), Treat was employed by Great Nation Investment Corporation (Great Nation) at the time of the activity. If you have been a victim of Treat’s alleged misconduct, our firm may be able to assist you in recovering funds.

In January 2021, FINRA brought a regulatory action and found that Treat consented to sanctions and findings that he failed to provide documents and information requested by FINRA in connection with an investigation into whether Treat reasonably supervised the sale of certain illiquid investments while at Great Nation.

In February 2021 Great Nation terminated Treat alleging that he failed to supervise the sale of certain church bonds and failed to provide information related to the investigation.

In May 2013, Treat consented to a fine of $5,000 for failing to establish, maintain, and enforce an adequate supervisory system regarding the offering of certain investments at Great Nation.