Wedbush Securities

Former Morgan Stanley Advisor Ken Hutkin Terminated For Undisclosed Activities

September 15, 2021 | by Staff Attorney

The attorneys at Gana Weinstein LLP are investigating BrokerCheck records reports that Kenneth Hutkin, currently employed by Wedbush Securities Inc., (Wedbush) has been subject to at least five customer complaints during his career. According to records kept by the Financial Industry Regulatory Authority (FINRA), Hutkin’s customer complaints allege that Hutkin recommended unsuitable investments, engaged in churning, overcharged certain corporate security debts, and engaged in unapproved outside business practices.

In February 2020, a customer complained that Hutkin violated the securities laws by alleging that Hutkin engaged in unsuitable investment advice. The claim does not specify any amount with respect to damages. However, the complaint was denied.

In September 2018, a customer complained that Hutkin violated securities laws by alleging that Hutkin engaged in unapproved outside business activities, including payments for some such activities. Hutkin was terminated by his employer, Morgan Stanley, for these allegations.

In October 2008, a customer complained that Hutkin violated securities laws by alleging that Hutkin overcharged certain corporate debt securities. The claim settled in the amount of $52,958.

In June 1993, a customer complained that Hutkin violated securities laws by alleging that Hutkin engaged in unsuitable investment advice and churning. The claim settled in the amount of $23,000.

In June 1992, a customer complained that Hutkin violated securities laws by alleging that Hutkin engaged in unsuitable investment advice and churning. The claim settled in the amount of $130,000.

Wedbush Advisor David Hirons Has Suitability Customer Complaints

April 9, 2021 | by Staff Attorney

According to records kept by The Financial Industry Regulatory Authority (FINRA) financial advisor David Hirons (Hirons), currently employed by Wedbush Securities Inc. (Wedbush Securities), has been subject to at least four customer complaints and one termination for cause during the course of his career. Hirons’s customer complaints alleges that Hirons recommended unsuitable investments in various investments including equities, futures funds, and options.

In April 2018 Hirons was discharged by RBC Capital Markets, LLC when the firm alleged that he was terminated for violating the firm’s order execution policy.

In August 2019 a customer complained that Hirons violated the securities laws by alleging that Hirons made investments recommendations that the client alleges involved options trading from June 2018 until December 2018 resulted in liquidations and losing funds. The claim alleged $712,080 in damages and settled for $65,000.

Advisor Michael Sims Alleged to Have Recommended Unsuitable Energy Securities

September 27, 2019 | by Staff Attorney

According to BrokerCheck records financial advisor Michael Sims (Sims), formerly employed by Wedbush Securities Inc. (Wedbush Securities), has been subject to at least four customer complaints during the course of his career. According to records kept by The Financial Industry Regulatory Authority (FINRA) Sims has been accused by multiple customers of unsuitable investment advice concerning various investment products including energy stocks most likely including master limited partnerships (MLPs). The law offices of Gana Weinstein LLP continue to report on investor related losses and potential legal remedies due to recommendations to investor in oil and gas and commodities related investments.

In August 2019 a customer filed a complaint alleging that Sims violated the securities laws by engaging in, among other violations, excessive trading, inappropriate investments, mismanagement of account, excessive commissions and lack of supervision. The claim alleges $250,000 and is currently pending.

In January 2019 a customer filed a complaint alleging that Sims violated the securities laws by engaging in, among other violations, unsuitability, breach of fiduciary duty of loyalty, negligence, negligent misrepresentation, breach of contract, material omissions and misrepresentations in connection with the sale of securities, fraud and deceit based on concealment and violations of Federal statutes, California laws and FINRA Rules and. The claim alleges $2.7 million and settled for $702,600.

Our firm handles claims and is also investigating securities claims against brokerage firms over sales practices related to the recommendations of oil & gas and commodities products such as exchange traded notes (ETNs), structured notes, private placements, master limited partnerships (MLPs), leveraged ETFs, mutual funds, and individual stocks.

Larry Boggs Barred by FINRA from Industry for Executing Unauthorized Trades

July 5, 2018 | by Staff Attorney

According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA), in January 2018, advisor Larry Boggs (Boggs) was barred indefinitely from the financial industry by FINRA concerning allegations that he engaged in unsuitable investments, excessive trading and unauthorized transactions. According to FINRA, Boggs exercised discretion in customer accounts without written approval from customers or the firm. Boggs would also allegedly falsely state the investment objectives and risk tolerance of customers in the firm’s books so that customers would conform to his high-frequency trading strategy.

FINRA found that in June 2010, Boggs updated the risk tolerance in 4 investment portfolios from Moderate to Moderate/Aggressive, and changed 2 investment portfolio objectives to Aggressive. FINRA determined that the high-frequency trading strategy was unsuitable to his customer’s needs and did not match the customer’s investment portfolio objectives. By changing Ameriprise’s books and records, Boggs violated FINRA Rules 4511 and 2010.

In addition, in May 2015, Boggs’ employer, Ameriprise Financial Services, Inc. (Ameriprise Financial) discharged Boggs alleging that Boggs violated the company’s discretionary trading and suitability policies.

William Heiden Accused of Concentrating Customers in Oil & Gas Investments

December 10, 2017 | by Staff Attorney

According to BrokerCheck records financial advisor William Heiden (Heiden), employed by Wedbush Securities Inc. (Wedbush), has been subject to nine customer complaints. According to records kept by The Financial Industry Regulatory Authority (FINRA) Heiden has been accused by a customers of unsuitable investment advice concerning various investment products including energy stocks including master limited partnerships (MLPs). The law offices of Gana Weinstein LLP continue to report on investor related losses and potential legal remedies due to recommendations to investor in oil and gas and commodities related investments.

The most recent claim was filed in June 2017 and alleges that Heiden, breach his fiduciary duty, committed violation of industry rules, and financial elder abuse causing $855,299. The customer’s accounts were maintained at the firm from September 2013 to April 2017. The claim is currently pending. The broker has stated in defense of the claim that market conditions and the collapse of oil prices in 2014 and 2015, resulted in a loss of value of some stock and bond positions in the customer’s account.

In January 2017 a customer alleged that Heiden, that from March 2012 to February 2016, made unsuitable investments in the client accounts causing $950,718 in damages. The claim is currently pending.

Wedbush Securities Regulatory Actions Explored Part III

January 21, 2015 | by Staff Attorney

This post continues our examination of the numerous regulatory actions against Wedbush Securities, Inc. (Wedbush) for its failure to supervise the activities of its employees and the recent National Adjudicatory Council (NAC) decision affirming the FINRA hearing decision.

What were the failures to report that were claimed by FINRA? In one instance, a client faxed a letter to Wedbush alleging that his broker had committed unauthorized trades but Wedbush did not report the complaint until January 2010, 275 days later. At hearing Wedbush conceded that the complaint was not timely reported but disputed their responsibility for the late reporting because a firm office manager failed to forward the letter to the business conduct department after concluding that the letter wasn’t a customer complaint. FINRA found though that the office manager’s failure does not excuse the late filing or the firm’s responsibility for the late filing.

In addition, the firm had argued that Mr. Wedbush was not liable for failure to supervise because he was more of a manager than a supervisory. Again, FINRA disagreed stating that as president he was ultimately responsible for the misconduct.

Wedbush Securities Plagued by Numerous Regulatory Actions Part II

January 20, 2015 | by Staff Attorney

This post continues our examination of the numerous regulatory actions against Wedbush Securities, Inc. (Wedbush) for its failure to supervise the activities of its employees in various respects.

In November 2014, the SEC’s case was settled with Wedbush and two of its top officials have for market access violations. Wedbush settled by admitting wrongdoing in its actions, paying a $2.44 million penalty, and retaining an independent consultant. Wedbush’s former executive vice president Jeffrey Bell (Bell) and senior vice president Christina Fillhart (Fillhart) settled without admitting or denying the SEC’s findings. Bell and Fillhart agreed to pay a combined total of more than $85,000 in disgorgement and penalties. The SEC order found that Wedbush had inadequate risk controls in place before providing customers with access to the market including some anonymous overseas traders.

In a statement, Andrew Ceresney, director of the SEC Enforcement Division stated that “Wedbush acknowledges that it granted access to thousands of overseas traders without having appropriate safeguards in place.”

Wedbush Securities Supervisory Failures Exposed in Numerous Regulatory Actions Part I

January 20, 2015 | by Staff Attorney

In a slew of regulatory actions, Wedbush Securities, Inc. (Wedbush) has the firm under fire for its failure to supervise the activities of its employees in various respects. These complaints were recently capped off with an affirmation by the Financial Industry Regulatory Authority’s (FINRA) appeals body, the National Adjudicatory Council (NAC), decision imposing more than $300,000 in fines and a month-long suspension of top executives for failures in their reporting duties. Decision Here.

Wedbush is a brokerage and investment banking firm founded by Edward Wedbush (Mr. Wedbush) and another individual in 1955. Wedbush registered with the NASD in 1955 and NYSE in the early 1970s. At present the firm employs approximately 900 employees. Mr. Wedbush joined the securities industry in 1955 when he formed the firm and has been registered as a general securities principal and representative since the firm’s inception.

A company’s culture is set at by those at the top running the company. And judging by the recent decision, Wedbush’s supervisory culture calls into question the handling of its client’s assets. The recent regulatory woes and saga first started on October 4, 2010, when FINRA’s Department of Enforcement filed a five-cause complaint alleging that during various periods between January 2005, and July 2010, Wedbush failed to properly report 81 disclosable events resulting in 38 Form RE-3 reporting violations, 113 Form U4 and U5 violations, and nine statistical reporting violations concerning customer complaints. FINRA also alleged that the firm and Mr. Wedbush failed to supervise the firm’s regulatory reporting.