Feltl & Co. Broker Timothy O’Brien Sanctioned by Securities Regulator

December 31,2014

Timothy David O’Brien   entered into a Letter of Acceptance, Waiver and Consent  (AWC) with the Financial Industry Regulatory Authority (FINRA) to resolve allegations that he traded the accounts of several his customers at Feltl & Company  without their  prior written authority (exercised discretion)

Industry rules provide that “no member or registered representative shall exercise discretionary power in a customer’s account unless such customer has given prior written authorization to a stated individual or individuals and the account has been accepted by the member…”

From July 2012 to February 2013, O’Brien used discretion to execute over 170 transactions in the customers’ accounts.

Case # 2013036967201

O’Brien was suspended for ten days and agreed to pay a fine of $5,000.

According to FINRA records O’Brien has been  registered with Feltl & Company since  5/4/2012. Prior to that he was registered with Robert W. Baird & Co.

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

Scott Cameron Nicol Sanctioned by Securities Regulators

December 23, 2014

Scott Cameron Nicol  entered into a Letter of Acceptance, Waiver and Consent  (AWC) with the Financial Industry Regulatory Authority (FINRA) to resolve allegations that he willfully failed to timely amend his Form 4 ( a FINRA record) to disclose the following:

  • A June 15, 2006 small claims court lien  from Macomb County, MI
  • Two 2007 IRS tax liens totaling over $150,000 which were subsequently released in 2011.
  • A 2011 judgment entered by a FINRA arbitration panel against him of more than $117,000.
  • A small lien entered against him in 2012 in Oakland County, MI.

Case # 2013036671901

Nicol was suspended for six months and agreed to pay a fine of $5,000.

According to FINRA records Nicol was registered with L.M. Kohn & Company from 6/2013-11/2013. Prior to that he was registered with Merrill Lynch.

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

 

 

Calton & Associates/R.M. Duncan Named in Regulatory Complaint For Unfair Bond Sales

December 31, 2014

The Department of Market Regulation of FINRA filed an action against Calton & Associates and R.M. Duncan Securities, Inc. and several registered representatives alleging that in connection with the sale of “Ravenwood Bonds”, they charged customers prices that were not fair or reasonable and engaged in deceptive, dishonest and unfair practices.

The Ravenwood Bonds are Maryland St Economic Dev Corp SR-Ravenwood Healthcare FAC-A Bonds, Cusip 57420UAK1, with a coupon rate of 8.75% and a maturity date of 8/1/2027.

The individuals named in the complaint are:

  • Randall M. Duncan
  • Stephen B. Murchison
  • Kenneth R. Harter

The pleading alleges that the bonds were sold to customers at prices that were 60% higher than the prevailing market price.

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

Austin Arbitration Panel Orders Ameriprise/ Justin Montandon To Pay Customer $127K

December 11, 2014- Austin , Texas 

Ameriprise Financial Services, Inc. was ordered by an arbitration panel in Austin, TX, to pay a former customer over $127,000 for rendering bad advice regarding making additional contributions to a Life Protection Plus insurance policy. The customer claimed that the broker told them they would be guaranteed a minimum 4% interest return on additional cash contributions to the policy and failed to tell them that if the insured died, only the face amount would be paid to the  beneficiary. All additional cash paid into the policy would be lost.

The case McNamara Estate v Ameriprise Financial Services and Justin A. Montandon , FINRA Case#13-1087, was heard over a three day period by a three person, all public, FINRA arbitration panel. FINRA (the Financial Industry Regulatory Authority) is the regulatory agency that oversees and licenses stock brokers and broker dealers.

If you have suffered damages in your brokerage account due to the fraud or negligence of a stock broker, you may be entitled to damages through FINRA arbitration. Call for details.

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

Daniel K Steele Sentence to 7 Years on Foreign Currency Fraud-Rolla, MO

UPDATE MARCH 2017- Daniel K. Steele sentenced to seven years in prison in connection with a foreign currency trading fraud according to a press release from the US Attorney’s Office for the Eastern District of Missouri. 

On December 15, 2014, Judge Ronnie L. White of the US District Court for the Eastern District of Missouri ordered Daniel Keith Steele of Rolla, Missouri, and his company Champion Management International to pay $1.5 million in restitution and a civil penalty of $1 million.

Steele’s wife Judy Dianne Steele was required to pay back over $187,000 in “ill-gotten gains”.

The order also permanently bans Steele and his company from registration and trading.

The court document alleges that Steele raised nearly $2 million from  over 24 investors who thought their money was being invested in foreign currency pools. In reality, Steele spent much of the money on personal expenses.

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

PHX Financial Accused of Churning in Montana Securities Regulator Action

On October 28, 2014 the Montana Commissioner of Securities filed a Notice of Proposed Agency Action and Opportunity against PHX Financial, Inc. , aka Blackwall Capital, a Montana licensed broker-dealer and the following former and present employees of PHX Financial:

  • William Horbatuk, Jr. -former sales person for PHX.
  • Halil Kozi– Registered Options and Security Futures Principal for PHX
  • Robert Delaplain– Chief Compliance Officer of PHX
  • Kevin Chen– PHX’s CEO
  • Kenneth Williams- served as Horbatuk’s direct supervisor

The Montana regulatory pleading’s allegations include the following:

  • On May 7, 2013 , the Montana Securities Commissioner notified Chen and informed him that a heightened supervision plan would be needed because Horbatuk had eight reportable items on his FINRA record (CRD)
  • In June 2014 a Montana resident and Horbatuk client submitted a complaint to the Montana Commissioner alleging that Horbatuk had traded his account excessively, charged him excessive commissions, failed to provide account statements and traded on margin without authority.
  • An analysis of the account revealed that over an 18 month period Horbatuk initiated 125 transactions in 51 securities in the client’s account, of which 105 were solicited.
  • Several stocks were bought and sold several times over short periods. Ampio Pharmaceutical was purchased and sold 23 times in 8 months and Questcor Pharmaceuticals was purchased and sold 19 times over 9 weeks.
  • The client’s account lost $147,079 of the $147,443 he initially invested.
  • Commissions paid to PHX and Horbatuk totaled over $75,000
  • The turnover rate was over 33 using the Looper formula.

The Montana Securities Commissioner action seeks various relief, including,  fines, restitution and revocation of PHX’s registration in Montana.

Churning and the “Looper” Turnover Rate

The Looper turnover rate calculates the total dollar amount of purchases during a time period divided by the average account equity and then annualized. As a rule of thumb twice a year turnover is “suggestive” of excessive trading. Four times a year is “indicative” and six times a year turnover is “conclusive” of excessive trading.

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

KMS Financial Services Placed on Probation By Florida Securities Regulators

On July 24, 2014, KMS Financial Services entered into a consent order with the State of Florida-Department of Financial Services in which the State of Florida agreed to license KMS Financial Services and KMS Financial Services agreed to be placed on probation and pay $8,000 in administrative costs. Docket Case #150989-14-AG

As a condition of the probation, KMS was ordered to submit a plan to avoid all future violations of securities laws, regulations, and SRO rules in connection with the sale of private placements. The period of probation is two years.

KMS Financial Securities, headquartered in Seattle, WA,  has been a FINRA member since 1969.  They are a subsidiary of Ladenburg Thalmann Financial Services, Inc. They have about 435 registered representatives in over 300 branch offices

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