Category Archives: First Allied Holdings

Losses on RCS Capital (RCAP) ? Recovery Options for Investors.

December 3, 2015

RCS Capital Corp. (RCAP) was trading at over $38 in April 2014. At the time of this writing it is trading for 43 cents. Investors who have suffered losses on RCAP may be able to recover damages from the brokerage firm that recommended the investment if it can be shown that the recommendation was not suitable.

How did the value of this once high flying company drop so dramatically?

Last month , RCS Capital, founded by real estate mogul Nicholas Schorsch, settled charges with Massachusetts securities regulators who had charged the company with fraudulently obtaining proxy votes to support real estate deals sponsored by AR Capital, a related company. RCAP agreed to pay $3 million to settle the charges.

This week RCS Capital announced that they would shut down its wholesale brokerage division Realty Capital Securities due to declining sales of nontraded real estate investment trusts (REITs). This move will result in the layoff of around 200 people, according to recent press.

RCS Capital was on an acquisition binge over the past couple of years acquiring a string of independent broker dealers. At the time Schorsch was criticized for overpaying for these small brokerage firms and after third quarter reporting results, it appears the criticism was warranted, based upon the massive write-offs taken:

  • Cetera Financial Holdings-purchased in 2014 for $1.15 billion, written down by $134 million.
  • Summit Financial Services Group= purchased in 2014 for $57.2 million, written down by nearly $10 million.
  • First Allied Holdings purchased in 2014 for $177 million, written down by nearly $45 million.
  • Investors Capital Holdings purchased in 2014 for $52.5 million, written down by $26.7 million.
  • VSR Group, purchased in 2015 for $66.7 million, written down by $28 million.
  • Girard Securities purchased in 2015 for $27.8 million, written down by $13.2 million.
  • J.P. Turner purchased in 2014 for $32.7 million was written down by over $13 million earlier this year.

RCAP took additional write-offs on other business units totaling tens of millions of dollars as well.

If you suffered losses on RCAP that you purchased based on the recommendation of your broker you may be able to recover damages from the broker dealer where the broker worked at the time. Call to discuss your legal 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

IBN Financial Broker Anthony Diaz Sued by FINRA for Multiple Securities Violations

In August 2014, the Financial Industry Regulatory Authority (FINRA) filed a complaint against stockbroker Anthony Diaz of IBN Financial Services, Scotrun, PA.

The complaint, FINRA Disciplinary Proceeding No. 2011030254902, alleges a myriad of wrongdoing by Diaz, including:

  • From March 2010-May 2011, Diaz solicited 80 customers to exchange variable annuities without a reasonable basis for recommending those exchanges. (This is know as annuity swapping, a form of churning)
  • During 207-2010, DIaz falsely told customers that direct participation partnerships and real estate investment trusts (REITs) were guaranteed.
  • He recommended an illiquid product to an 88 year old customer, violating suitability requirements.
  • He falsified the liquid net worth, net worth and/or income information of at least nine customers to make it appear that they were eligible to invest in REITs and direct investment partnerships when in fact they were not. He also changed dates and forged documents.
  • Diaz made unauthorized trades in the accounts of at least 7 customers

Diaz was first registered as a stockbroker in 2000. During this 14 years he has worked for eleven firms:

  • IBN Financial Services
  • Sandlapper Securities
  • International Financial Solutions
  • Kovack Securities
  • Matrix Capital Group
  • SII Investments
  • First Allied Securities
  • Round Hill Securities
  • Raymond James Financial Services
  • Edward Jones
  • Horwitz & Associates (now InSight Securities) 

According to FINRA records Diaz was fired or allowed to resign from half of the firms where he worked for reasons including:

  • Solicited sales of variable annuities to clients without being properly appointed with annuity company
  • Complaints that Mr. Diaz entered unauthorized trades
  • Violated firm’s prohibition against unauthorized trading

If you suffered losses in an account handled by Mr. Diaz you may be able to recover damages. If you suffered damages in an account handled by your broker as a result of churning annuities, unauthorized trading or forgery, call to discuss your legal 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

RCS Capital Corp. To Buy Girard Securities, Inc.

RCS Capital Corp. , announced its intention to buy Girard Securities, Inc. , broker dealer based in San Diego that has over $10 billion in assets under management and 250 financial advisers.

Last week RCS announced the purchase of VSR Financial, and earlier in the year acquired Cetera Financial Group, Investors Capital Holdings, First Allied Holdings, Summit Financial and J.P. Turner. 

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

VSR Financial Sold to RCS Capital Corp.

On August 7, 2014, The Investment News reported that RCS Capital Corp. (RCAP) , a broker dealer controlled by Nicholas Schorsch, has agreed to buy VSR Financial Services, Inc. Terms of the deal were not disclosed.

During the past year RCAP announced the purchase of four Cetera Financial Group broker dealers, Investors Capital Holdings, First Allied Holdings, Summit Financial, and J.P. Turner. 

VSR Financial, which was recently sanctioned by the Financial Industry Regulatory Authority (FINRA) for improper sales of alternative investments, is based in Overland, Kansas.  VSR has over 260 financial advisors nationwide and more than $12 billion of assets under management. See details here. 

We are investigating potential investor claims for investors suffering losses on unsuitable investments purchased from VSR Financial Services. 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

 

RCS Capital Closes Purchase of J.P. Turner and Summit Financial

By Robert H. Rex, Esq.


On June 13, 2014, RCS Capital Corp. , owned by Nicholas Schorsch, announced the closing of the purchases of two more independent broker dealers–J.P. Turner & Co. and Summit Financial Group

RCS Capital went public last year (symbol RCAP) and bought two other independent broker dealers, First Allied Holdings, Inc. and Cetera Financial Group, shortly thereafter. RCS has a deal pending for the purchase of Investors Capital Holdings Ltd. Following the closing of that deal the RCAP broker dealer network will have about 9,000 representatives which grossed about $1.7 billion in revenues in 2013. 

Stockbrokers are obligated to make suitable recommendations to their customers. If you have questions about investment losses and think you may be the victim of fraud or misrepresentation, call to speak with an experienced securities attorney to learn about your legal rights. 

Nationwide representation.


561 391 1900