Dennis Van Patter Investigation-VSR Financial-Plano, Texas

We are investigating VSR Financial Services stockbroker  Dennis Van Patter on behalf of one of his former customers whose account suffered significant losses. The subject account of our elderly lady client was invested in a number of alternative investments that appear unsuitable given her age, limited net worth and lack of financial sophistication.

The investments in non-conventional products such as real estate investment trusts (REITs), oil and gas limited partnerships and tax credit entities include the following:

  • APC 2003B
  • ATEL Fund 
  • Atlas Energy Public-17-2008B
  • Atlas Energy Public 18 2009B
  • Behringer Harvard REIT 1
  • Boston Capital Series L.P. 16-29 
  • CNL Lifestyle Fund
  • Cole Credit Property Trust
  • Cypress Equipment Leasing
  • Independence Tax Credit L.P.
  • Inland American Real Estate Trust
  • KBS Real Estate Investment Trust
  • MPF Income Funds
  • Penneco Oil Company 2008-1
  • Retail Properties of America
  • United Development Funding

According to FINRA records, Van Patter is registered with VSR Financial Services, Inc. a broker dealer with offices nationwide. Van Patter operates through First Financial Services Group in Plano, Texas.

Real estate investment trusts, especially those not traded on a
conventional exchange, as well as other alternative investments such as oil and gas and other limited partnerships are generally not considered suitable for retired conservative investors.

If you have losses in an account handled by Dennis Van Patter, you may be entitled to damages. Call to discuss your options.

Rex Securities Law , with offices in Boca Raton, FL,  and  Austin, TX,   provides representation to  investors  nationwide who are seeking recovery of investment losses due to the negligence or fraud of stockbrokers and broker dealers. If you have questions about how your account has been handled, call to speak with an experienced securities attorney.

Most cases handled on a contingent fee basis meaning that you do not pay legal fees unless we are successful.

Nationwide Representation

Rex Securities Law

TollFree: 877-224-3199

Florida-561 391 1900 

Texas-512-329-2870

FINRA Announces November 2012 Disciplinary Actions

 

The Financial Industry Regulatory Authority (FINRA) issues a report on disciplinary and other actions involving registered brokers, investment advisers and brokerage firms every month.

Here are significant Florida related actions for November 2012. Follow this link to the FINRA website for the entire report for actions nationwide for the month of November 2012 as well as to access  earlier time periods.

Raymond James & Associates (St. Petersburg, Florida)-censured and fined $250,000 for failure to safeguard against the unauthorized disclosure or personally identifiable information about firm customers after a customer complained that her firm account number and other personal information was available on the internet.

Charles Eugene Bishop, Jr.-Pompano Beach, Florida- was fined $7,500 and suspended from association with any FINRA member in any capacity for two years. Bishop consented to the described sanctions and to the entry of
findings that he attempted to misappropriate approximately $3 million from an elderly customer of his member firm. Bishop created paperwork by which the deceased customer’s assets would be transferred to a purported entity that was never formed, but whose name was virtually identical to a company the customer owned, with a tax identification number assigned by the Internal Revenue Service (IRS) to another entity that was never formed, but whose sole member, according to IRS records, was Bishop.

After the customer passed away, Bishop, through his attorney, filed a notice with a Probate Division with his state’s Circuit Court representing that he had an interest in the customer’s estate as a claimant and beneficiary of the deceased customer’s estate.

The suspension will be in effect from December 3, 2012, through December 2, 2014. According to FINRA records, Bishop is not currently registered. His last industry position was with Merrill Lynch. Prior to that he worked for Morgan Stanley.

Robert Joseph Eanell-St. Petersburg, Florida-was fined $7,500 and suspended from association with any FINRA member in any capacity for 30 business days. Eanell consented to the described sanctions and to the entry of findings that he misrepresented his educational background to prospective securities customers, including on his business cards. The findings stated that on annual forms, Eanell’s member firm asked him to identify all of the degrees, titles and designations that he used on letterhead, business cards or in communications with clients. Nevertheless, Eanell failed to disclose the fact that he held himself out as the holder of a doctoral degree.

The suspension was in effect from October 1, 2012, through November 9, 2012. According to FINRA records Eanell is no longer registered. He last worked for Sterling Enterprises Group. Prior to that he was with GunnAllen and AXA Advisors.

Evan Coley Eggers-Jacksonville, Florida-was fined $5,000 and suspended from association with any FINRA member in any capacity for six months. Eggers consented to the described sanctions and to the entry of findings that he made premium payments for his customers’ life insurance policies, using his personal funds to make the payments. The findings stated that each payment was submitted to his member firm via a money order, a practice forbidden by company policy. On each money order, Eggers falsified the customer’s signature. On a couple of occasions, Eggers falsified the customer’s signature to reduce the value of a life insurance policy. The findings also stated that all insurance policies at issue were less than one year old. By continuing payment of the premiums, all policies remained active through a period of 13 months, thus qualifying Eggers for potential remuneration.

The suspension is in effect from October 1, 2012, through March 31, 2013.

FINRA records indicate that Eggers is no longer registered. He last worked for Northwestern Mutual Investment Services.

Ellen Joyce Erenstein – Boynton Beach, Florida- was barred from association with any FINRA member in any capacity.  Erenstein consented to the described sanction and to the entry of findings that she failed to respond to FINRA requests to provide testimony concerning customer complaints prior securities customers and their heirs had filed against her.

FINRA records indicate that Erenstein is no longer registered having last worked for Workman Securities.

Brennan R. Lollar -St. Petersburg, Florida-was
barred from association with any FINRA member in any capacity. The sanction was based on findings that Lollar misappropriated funds from a bank where he worked as a branch manager. The findings stated that without the bank’s permission or authority, Lollar transferred funds into customers’ accounts and labeled the transfers as refunds of bank fees. No bank fees had ever been assessed to the customers, and Lollar knew the customers were not entitled to any refunds. Through a series of several small transactions, Lollar misappropriated a total of $3,242.90 into customers’ accounts. The findings also stated that Lollar admitted to the bank that he issued the false refunds and claimed that he did
so to assist, or to curry favor with, certain customers. The bank obtained reimbursement through the liquidation of Lollar’s retirement fund. The findings also included that other
than Lollar providing FINRA with a photocopy of a written statement previously provided to the bank admitting to certain aspects of his misconduct, he did not respond to FINRA requests for information and failed to appear for a FINRA on-the-record interview.

Brennan last worked for SunTrust Investment Services and is no longer registered per FINRA records.

Rex Securities Law , with offices in Boca Raton, FL,  and  Austin, TX,   provides representation to  investors  nationwide who are seeking recovery of investment losses due to the negligence or fraud of stockbrokers and broker dealers. If you have questions about how your account has been handled, call to speak with an experienced securities attorney.

Most cases handled on a contingent fee basis meaning that you do not pay legal fees unless we are successful.

Nationwide Representation

Rex Securities Law

TollFree: 877-224-3199

Florida-561 391 1900 

Texas-512-329-2870

 

FINRA Quarterly Disciplinary Review- October 2012

Each quarter, the Financial Industry Regulatory Authority (FINRA) publishes a review of recent disciplinary actions involving stock brokers (known as registered representatives in the industry). This review is intended to provide brokerage firms and brokers with insight into issues that can lead to disciplinary actions. Follow this link to the FINRA site to see the complete Quarterly Review as well as the Monthly Disciplinary Actions.

Here is a summary of some of the issues and conduct FINRA recently addressed:

  • Sharing Commissions with Unregistered Persons-A registered broker paid 40% of his brokerage commissions (over a quarter of a million dollars) to an unregistered person who was assisting the broker with his stock picks. The unregistered person had at one time been registered but because of his disciplinary history, was not currently registered to sell securities. FINRA suspended the broker for a year  and fined him $20,000.
  • Fraudulently Misappropriating Customer Funds– A broker convinced two clients to transfer $100,000 to the broker which he then misappropriated. One customer believed he was buying bonds and the second thought he was purchasing a CD. FINRA barred him from the industry.
    Comment: Unfortunately here in South Florida, as well as elsewhere in the Sun Belt, there seems to be an abundance of brokers who are willing to take advantage of the resident senior citizens. There is never a time that a customer should be making a check payable to the broker individually. Deposits should be made to your brokerage account.
  • Recommending Unsuitable Transactions– A 53-year-old widow working as an administrative assistant in the public schools and earning $55,000 sought advice regarding retirement. She owned a home mortgage free that was worth $500,000 and had $260,000 in retirement funds. The broker drafted a plan that involved taking out a mortgage and investing the proceeds. The broker referred the lady to a related company for the mortgage earning himself a nice finders fee. The proceeds of the mortgage, about $300,000 was invested in an annuity at the broker’s instruction, earning him another nice commission.  FINRA fined the broker $5,000 and suspended him finding that there was no reasonable basis for recommending the customer mortgage her home and buy an annuity.  Comment: Annuities are one of the biggest commission generators for brokers and while   there are many suitable annuity products, one must carefully scrutinize the product before investing. Obviously mortgaging a home and investing it in the market has risks beyond what most retirees can tolerate.
  • Willfully Failing to Report Material Information– FINRA maintains a running record (CRD)  of every broker’s employment, regulatory and disciplinary history. It contains dates of employment, reasons for termination, licensing information, including number of times a test has been taken and whether it was passed or failed, as well as disciplinary actions and customer complaints. As a condition of licensing, brokers are required to report certain events to FINRA for inclusion on the CRD. In the case reported a broker did not timely disclose tax liens and judgments and a personal bankruptcy. The broker was suspended for six months and fined $10,000. Comment: Wouldn’t you like to know if your broker has tax liens, has filed for personal bankruptcy or has been terminated from other positions? You can obtain this information, free of cost, by visiting FINRA’s Broker Check site.
  • Exercising Discretion Without Customer and Firm Approval– Broker’s are obligated to obtain customer approval before buying and selling in the customer’s account. This can be accomplished by a discretionary trading agreement signed by the client and authorized by the employing firm. In this case the broker made trades in options without permission of the customer and in the absence of written authorization. The trades resulted in losses of nearly $500,000. The broker was suspended and fined.
  • Improperly Borrowing from a Customer– A broker borrowed $100,000 from a customer in violation of FINRA rules and did not disclose it to his firm. The broker lied about the existence of the loan when completing an employment application at his new firm and then defaulted on the loan. The broker was fined and suspended.
  • Selling Away– When a broker attempts to have a customer make an investment in a company or product that is not one authorized by the employing firm, essentially a private securities transaction, it is called “Selling away” as is selling away from the firm. Most firms require that before a broker engage in a private securities transaction the broker must obtain prior firm approval. Brokers often are tempted to raise funds from their customers to fund private investment deals put together by friends and business associates. In this case the broker was suspended, fined and required to repay the finders fee he earned for raising the capital.

If you have questions about your brokerage account or have suffered unexplained losses, please do not hesitate to contact us.

Nationwide representation.

Free consultation

Rex Securities Law