Securities Lawyers Blog
According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker Christopher Shaw (Shaw), previously associated with Newbridge Securities Corporation, has at least one disclosable event. These events include one tax lien, alleging that Shaw recommended unsuitable investments in different investment products including debt securities among other allegations and complaints.
FINRA BrokerCheck shows a final customer complaint on October 23, 2024.
Without admitting or denying the findings, Shaw consented to the sanctions and to the entry of findings that he made unsuitable recommendations of alternative investments to senior customers. The findings stated that Shaw recommended and sold the management firm limited partnership interests to the customers, none of whom were accredited investors, for whom those investments were unsuitable in light of their investment profiles, including their annual incomes and net worths. In addition, as a result of Shaw’s recommendations, each customer’s combined holdings of alternative investments, including in the management firm, exceeded 30% of the customer’s liquid net worth. Shaw’s recommendations to purchase the management firm’s limited partnership interests to these customers were unsuitable based on the customers’ age, income, net worth, risk tolerance, and because they were not accredited investors. In addition, Shaw’s recommendations were unsuitable because they resulted in a level of concentration of the customers’ liquid net worth in alternative investments that was not suitable for their investment profiles. Subsequently, the SEC filed a complaint against the management firm and others alleging, among other things, that the defendants engaged in securities fraud in violation of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. (Case No. 1:21-cv-00583, E.D.N.Y.). The United States Department of Justice also brought criminal charges against the management firm’s founder and CEO and two other executives, charging, among other things, securities fraud, mail fraud and wire fraud. (Case No. 1:21-cr-54, E.D.N.Y.). Later, one of the management firm’s former executives pled guilty to wire fraud. Ultimately, a federal jury found the management firm’s founder and CEO, along with the other former executive, guilty on all counts.
