Securities Lawyers Blog
The law offices of Gana Weinstein LLP are currently investigating claims that advisor James Seijas (Seijas) has been accused by investors of engaging in a Ponzi scheme investment called 3Q Trading Club. Seijas was barred The Financial Industry Regulatory Authority (FINRA) and left the employ of Wells Fargo Clearing Services, LLC in March 2019 relating to engaging in undisclosed investment activities including undisclosed outside business activities (OBAs). If you have been a victim of Seijas’s alleged misconduct our firm may be able to assist you in recovering funds.
In November 2021 Seijas consented to sanctions and findings that he refused to appear for on-the-record testimony requested by FINRA in connection with its investigation concerning the Form U5 amendment filed by Wells Fargo. Seijas disclosed that he had been named as a defendant in a lawsuit alleging that he had misrepresented investments as part of a Ponzi scheme. Thereafter, multiple clients have filed complaints relating to Seijas’ involvement.
In an SEC complaint, the agency alleged that Michael W. Ackerman, July 1, 2017 until at least December 1, 2019, through Q3 Trading Club and Q3 I, LP raised at least $33 million from more than 150 investors through the offer and sale of securities to investors who were mostly physicians. According to the SEC, Ackerman was the principal trader of the Q3 companies and told investors he developed and used a proprietary trading algorithm that allowed him to take advantage of the volatility of cryptocurrencies when trading investor funds. In fact, Ackerman invested no more than $10 million of the $33 million raised from investors in cryptocurrencies and profits were minimal. The SEC accused Ackerman of concealing the truth from investors by preparing false financial records by doctoring screenshots showing Q3 trading account balances as well as monthly newsletters falsely reflecting that the Q3 Companies generated monthly profits of at least 15%. Further, Ackerman and his partners paid themselves about $4 million of the investors’ funds as purported licensing fees based on use of the algorithm.
Our law firm has significant experience bringing cases on behalf of defrauded victims when their advisors engage in receiving loans from clients or selling securities sales through 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. 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. Sometimes those investments have some legitimacy but often times these types of investments can end up being Ponzi schemes or the advisor can be engaging in the conversion of funds.