VSR Financial Clients May Have Claim For Losses on Private Placements & Alternative Investments

Customers who purchased private placements and/or other alternative investments from VSR Financial may be able to recover damages for losses on these investments if the broker misrepresented the investments when he was selling them or if the investments are not suitable for your portfolio.

Brokers are required to “know the customer” and to make investment recommendations that are suitable, taking into account the customer’s age, health, investment experience, investment objectives and risk tolerance.

VSR Financial was recently sanctioned and assessed a fine of $550,000 in connection with the sale of alternative investments, non-conventional investments and private placements. VSR alt inv. FINRA sanction may 2013

The FINRA investigation criticized VSR for allowing customers to invest too large a percentage of their net worth in these alternative investments and for allowing brokers to provide inaccurate reports to customers and for falsification of documents used to obtain approval of the sales of these products. Because of the inaccurate pricing used by brokers and the firm’s lack of supervision, customers received statements with erroneous pricing information.

Some of the alternative investments sold by VSR Financial include:

  • Penneco Oil Company
  • Odyssey Diversified Notes IX
  • Arciterra Note Fund III
  • Mewbourne Energy Partners
  • Waveland Resource Partners
  • Waveland Energy 2011-A Drilling
  • UDF III
  • UDF Land Opportunity
  • Net REIT
  • Odyssey Diversified VI
  • Arciterra Note Fund III
  • Odyssey Diversified Notes IX
  • MPF Income Fund 22 LLC
  • Behringer Harvard Opp REIT
  • Cole Credit Property Trust II
  • DBSI 2008 Notes Corporation

In October 2010, VSR Financial broker Michael D. Shaw entered into a Letter of Acceptance, Waiver and Consent (AWC) with FINRA and consented to a permanent bar from the industry for misrepresentations and unsuitable recommendations made in connection with the sale of private placement investments . ( AWC 2010022963601). 

Shaw was found to have misrepresented the risks associated with the sale of private placements and to have made unsuitable recommendations to customers. In addition Shaw altered internal VSR compliance documents in order to falsely qualify the customers for purchase of the subject investments. Shaw was barred from the industry.

If you purchased alternative investments, private placements and/or other non-conventional investments from VSR Financial and believe that the nature of the risk associated with the investments was misrepresented or if you feel the investments are not suitable, you may be able to recover damages through FINRA arbitration.

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

Former Wells Fargo Broker Randy Hayes Barred by FINRA for Theft

The Financial Industry Regulatory Authority (FINRA) is the largest independent regulator for all securities firms doing business in the United States. FINRA’s chief role is to protect investors by maintaining the fairness of the U.S. capital markets.

All stockbrokers and broker dealers (brokerage firms) are required to be licensed by and subject to the rules and regulations of FINRA. Each month FINRA publishes disciplinary actions against brokers and broker dealers. Discipline can range from monetary fines and suspensions, or in extreme cases, revocation of licensing and a bar from the securities industry.

See the FINRA website for current and historical disciplinary actions.

September 2013

Randy Willis Hayes III (CRD #5361647, Registered Representative, West Palm Beach, Florida) was barred from association with any FINRA member in any capacity. Restitution was not awarded because Hayes and the bank where he was employed reimbursed the customers. The sanction was based on findings that Hayes withdrew, or failed to credit, over $22,000 in funds from the accounts of bank customers.

 

The findings stated that Hayes did so without their permission or the bank’s and by forging the customers’ signatures. Hayes withdrew funds from the customers’ bank accounts and deposited some of the funds into his personal account at another bank. To accomplish these unauthorized withdrawals, Hayes forged the customers’ signatures on separate bank forms. The findings also stated that Hayes, without permission or authority, closed a customer’s savings account at the bank that held $50,881.23, and transferred, without permission or authority, $41,000 to open a new bank account in the customer’s name. Hayes did not credit the customer’s new bank account with the $9,881.23 difference. Hayes also forged the customer’s signature on a bank form requesting the closure of the account. The forgery allowed Hayes to effect the unauthorized withdrawal from the customer’s bank account. Hayes deposited $6,378 into his account.

 

The findings also included that Hayes withdrew $800 from another customer’s certificate of deposit (CD) without the customer’s or the bank’s permission or authority by forging the customer’s signature on a bank withdrawal form and deposited $500 into his personal account. FINRA found that Hayes failed to appear for FINRA-requested testimony and failed to completely respond to FINRA’s request for information pertaining to the investigation into the customers’ allegations. (FINRA Case #2011026546701)

Hayes is not currently registered, according to FINRA records. He was registered with Wells Fargo Advisors 08/2007-02/2011.

According to local news reports, Hayes, of Greenacres, Florida, worked a a Lake Worth branch of Wells Fargo Bank. Investigators from the bank informed the Palm Beach County Sherrif’s office that they suspected Hayes of stealing money from three different accounts. Further investigation revealed that over $22,000 had been wrongfully taken leading to Hayes’ arrest in February 2012.

Rex Securities Law , located in Boca Raton, FL, 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.

Rex Securities Law

561 391 1900

Former Next Financial/Wells Fargo Broker Roy Harris FIned/Suspended for Unauthorized Trading

The Financial Industry Regulatory Authority (FINRA) is the largest independent regulator for all securities firms doing business in the United States. FINRA’s chief role is to protect investors by maintaining the fairness of the U.S. capital markets.

All stockbrokers and broker dealers (brokerage firms) are required to be licensed by and subject to the rules and regulations of FINRA. Each month FINRA publishes disciplinary actions against brokers and broker dealers. Discipline can range from monetary fines and suspensions, or in extreme cases, revocation of licensing and a bar from the securities industry.

See the FINRA website for current and historical disciplinary actions.

September 2013

Roy Bernard Harris II (CRD #1064750, Registered Representative, Fayetteville, Tennessee) submitted a Letter of Acceptance, Waiver and Consent in which he was fined $10,000 and suspended from association with any FINRA member in any capacity for 30 business days. Without admitting or denying the findings, Harris consented to the described sanctions and to the entry of findings that he effected discretionary transactions in customers’ accounts without obtaining the customers’ prior written authorization and without having his member firm’s acceptance of the accounts as discretionary accounts.

The suspension is in effect from August 19, 2013, through September 30, 2013. (FINRA Case
#2012034426001)

FINRA records report Harris’ registration history as follows:

Harris not currently registered.

Next Financial Group
01/2013-07/2013

Wells Fargo Advisors
01/2008-10/2012

A.G. Edwards & Sons
08/1983-01/2008

Rex Securities Law , located in Boca Raton, FL, 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.

Rex Securities Law

561 391 1900

ING Broker Bruce Harada Sentenced to 20 Years For Securities Fraud/Money Laundering

UPDATE March 2016FINRA records report that Bruce Harada has been named in 23 customer disputes, 22 of which have been settled and one of which is still pending. In January 2014 Harada was sentenced to 20 years for securities fraud and money laundering.

The Financial Industry Regulatory Authority (FINRA) is the largest independent regulator for all securities firms doing business in the United States. FINRA’s chief role is to protect investors by maintaining the fairness of the U.S. capital markets.

All stockbrokers and broker dealers (brokerage firms) are required to be licensed by and subject to the rules and regulations of FINRA. Each month FINRA publishes disciplinary actions against brokers and broker dealers. Discipline can range from monetary fines and suspensions, or in extreme cases, revocation of licensing and a bar from the securities industry.

See the FINRA website for current and historical disciplinary actions.

Original Post —September 2013

Bruce Martin Harada (CRD #2324524, Registered Representative, Honolulu, Hawaii) submitted a Letter of Acceptance, Waiver and Consent in which he was barred from association with any FINRA member in any capacity. Without admitting or denying the findings, Harada consented to the described sanction and to the entry of findings that he convinced some of his customers to withdraw funds from their securities accounts and write personal checks payable to him. Harada represented that he would invest these funds in a personal asset management product. In reality, the product did not exist. Instead of investing these funds as Harada represented, he converted at least $792,612 to his personal use over a three-year period. The findings stated that Harada failed to respond to FINRA requests for information. (FINRA Case #2012032670901)

FINRA records report Harada’s registration history as follows:

ING Financial Partners
01/2011-5/2012

ING Financial Advisers
01/2007-01/2011

Financial Network Investment Corp
03/1999-12/2006

Harada is not registered as of September 2013.

Rex Securities Law , located in Boca Raton, FL, 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.

Rex Securities Law

561 391 1900

Kovack Securities Broker Carlos Garcia Suspended/Fined

The Financial Industry Regulatory Authority (FINRA) is the largest independent regulator for all securities firms doing business in the United States. FINRA’s chief role is to protect investors by maintaining the fairness of the U.S. capital markets.

All stockbrokers and broker dealers (brokerage firms) are required to be licensed by and subject to the rules and regulations of FINRA. Each month FINRA publishes disciplinary actions against brokers and broker dealers. Discipline can range from monetary fines and suspensions, or in extreme cases, revocation of licensing and a bar from the securities industry.

See the FINRA website for current and historical disciplinary actions.

September 2013

Carlos C. Garcia (CRD #2635960, Registered Principal, Westport, Connecticut) submitteda Letter of Acceptance, Waiver and Consent in which he was fined $5,000 and suspendedfrom association with any FINRA member in any capacity for five months. Without admitting or denying the findings, Garcia consented to the described sanctions and to the entry of findings that he sold equity-indexed annuities (EIAs), non-securities products, to member firm customers and others outside the scope of his employment with his firm
and without providing it with any notice of the business activity. The findings stated that Garcia’s undisclosed sales totaled roughly $4.3 million and he received approximately $338,445 as compensation for the transactions. In annual attestations over the course of five years, Garcia falsely certified to the firm that he had not been engaged in any undisclosed outside business activity.

The suspension is in effect from August 19, 2013, through January 18, 2014. (FINRA Case #2012032914901)

FINRA records report Garcia’s registration history as follows:

Kovack Securities
10/19/2012-present (Sept 2013)

Metlife Securities
8/2004-7/2007

First Montauk Securities
5/2000-3/2004

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

 

Clinton Fraley Barred by FINRA for Failing to Cooperate With Investigation Into Misappropriated Customer Funds

The Financial Industry Regulatory Authority (FINRA) is the largest independent regulator for all securities firms doing business in the United States. FINRA’s chief role is to protect investors by maintaining the fairness of the U.S. capital markets.

All stockbrokers and broker dealers (brokerage firms) are required to be licensed by and subject to the rules and regulations of FINRA. Each month FINRA publishes disciplinary actions against brokers and broker dealers. Discipline can range from monetary fines and suspensions, or in extreme cases, revocation of licensing and a bar from the securities industry.

See the FINRA website for current and historical disciplinary actions.

September 2013

Clinton D. Fraley (CRD #5281935, RegisteredRepresentative, Greenwood Village, Colorado) was barred from association with any FINRA member in any capacity. The sanction wasbased on findings that Fraley failed to respond to FINRA requests for documents andinformation in connection with its investigation into whether he misappropriated moneyfrom customers.

(FINRA Case #2012033644301)

According to FINRA recoreds, Fraley was registered with MML Investor Services from 05/2011-10/2011 and with Northwestern Mutual Investment Services from 03/2007- 05/2011.

Rex Securities Law , located in Boca Raton, FL, 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.

Rex Securities Law

561 391 1900

Investigation of John H. Towers-VSR Financial-UPDATED JAN 2014

 JANUARY 2014 UPDATE: In January 2014, John Towers was fined $25,000 and suspended for three months by FINRA in connection with the sale of over $6 million of real estate investment trusts (REITs) and private placements to a couple that had indicated they wanted only moderate risk for their brokerage account. Official FINRA  records report that Towers was discharged by VSR Financial 12/31/2013.  See this for more details. 

Rex Securities Law, Boca Raton, FL , is investigating VSR Financial broker John H. Towers on behalf of one of his former customers whose account suffered losses in alternative investments. The subject account of our elderly 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 include the following:

  • Penneco Oil Company
  • Odyssey Diversified Notes IX
  • Arciterra Note Fund III, LLC
  • Mewbourne Energy Partners 10-A
  • Mewbourne Energy Partners 11-A
  • Waveland Resource Partners I
  • Waveland Energy 2011-A
  • Waveland Drilling Partners 2008A
  • UDF III
  • UDF Land Opportunity
  • NetReit

According
to FINRA records, Towers has been registered with VSR Financial
Services, Inc. since June 2002, and offices 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.

In May 2013, VSR
Financial Services was fined $550,000 for sales of alternative
investments that were too high a concentration level for customer
accounts, for falsifying sales documents and for providing inaccurate
and misleading reports.
See here for more information.

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