Category Archives: Blackwell Capital (PHX)

Christopher Veale Investigation-Numerous Customer Complaint & Regulatory Issues

FINRA records report that Christopher F. Veale , of New York,  who is not currently registered, is currently  named in a customer dispute:

  • FINRA Case 15-00373-customer alleges breach of fiduciary duty by Veale while he was employed with Brookville Capital Partners and seeks damages of $44,733. Settlements paid to customers have ranged from $35,000-$90,000. See his FINRA record for details. 

 

Prior Customer Complaints: Veale has been named in 10 customer disputes that have been resolved. Allegations against Veale include excess commissions charged, unsuitable investments, breach of fiduciary duty, excessive trading (churning) , unauthorized trading

Judgments/Liens vs. Veale: FINRA records report the following outstanding judgements/liens vs. Veale. According to FINRA “This type of disclosure event involves an unsatisfied and outstanding judgments or liens against the broker”:

  • Federal Tax Lien                                                  $503,008
  • State of NY -Nassau County                       $27,979
  • State Tax Warrant-Queens County        $189,187
  • American Express Centurion Bank         $201,562
  • State Tax Warrant-New York                      $184,257
  • Federal Tax Lien                                                  $143,672

Pending Regulatory Investigations vs Veale: 

  • State of Rhode Island– filed 1/15/2014- Notice of Intent to Revoke License, impose civil penalty, impose sanctions and opportunity for hearing. Alleges that Veale, while employed by Brookville Capital Partners churned the account of a senior investor.
  • Commonwealth of Massachusetts-filed 1/15/2014-Administrative Complaint and notice of adjudicatory proceeding regarding churning the account of a senior investor.

Prior Regulatory Actions vs. Veale:

  • FINRA-8/18/2015– Suspended for 12 months and fined $5,000. Veale consented to sanctions and entry of findings that he failed to timely produce documents and information requested by FINRA in connection with an investigation and that he failed to report liens against him totaling approximately $730,000.
  • Illinois-11/21/2005-Veale’s application for registration as a salesperson in Illinois withdrawn.
  • NASD-12/22/2004-Veale consented to sanctions suspending him , a fine and payment of restitution of $36,696 to a customer.

Veale’s Prior Registration History, includes the following:

  • Legend Securities                    5/2013-2/2015
  • John Thomas Financial         4/2013-5/2013  (expelled by FINRA 10/2013)
  • Meyers Associates                   11/2012-3/2013
  • Blackwall Capital Markets   6/2012-11/2012
  • Brookville Capital Mkts          1/2009-6/2012 (expelled by FINRA 6/2015)

If you have losses in an account handled by Christopher F. Veale, you may be able to collect damages from his employing firm. Call to speak with an experienced securities attorney 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

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