Category Archives: Securities & Exchange Commission (SEC)

Additional Individuals Indicted In Chimera Energy Corp. Fraud-Houston, Texas

Houston, Texas – July 2017

According to a press release from the US Attorney’s Office for the Southern District of Texas, a second superseding indictment has been issued by a  federal grand jury naming additional individuals and companies related to the Chimera Energy Corp. pump and dump fraud. Losses due to the fraud may exceed $25 million.

The following individuals were  named in September 15, 2016 indictment for a securities fraud scheme involving the stock of Chimera Energy Corp:

  • Andrew Ian Farmer, 38 , Houston, TX
  • Thomas Galen Massey, 46, Houston, TX

In a superseding indictment April 26,2017, a federal grand jury charged five additional individuals for their roles in the Chimera Energy fraud:

  • Eddie Douglas Austin, Jr. , 66, Houston, TX
  • Carolyn Price Austin, 62, Houston, TX
  • Charles Earl Grob, Jr. 37, Houston, TX
  • John David Brotherton, 57, League City, TX
  • Scott Russell Sieck, 58, Winter Park, FL

On July 20, 2017, a grand jury returned a second superseding indictment against Farmer, Eddie and Carolyn Austin, Brotherton, Sieck and Grob for roles in a broader securities fraud conspiracy involving at least 12 other companies from 2011 to 2017.

The release indicates that Massey pleaded guilty to his role on April 18,2017, and is set for sentencing in June 2018.

Pump and Dump Scheme

In a pump and dump scheme, the fraudsters engage in fraudulent trading practices in a company’s stock by publishing false and misleading information about the company with the intention of inflating the price of the stock. Once the stock rises as a result of this fake information, the fraudsters dump their stock on the market to the investors who have been misled by the false information.

Victims who may have been advised by a registered stockbroker to invest in any of these companies may be able to recover damages through FINRA arbitration. Call to learn about 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

SEC Files Action Over Verto Notes-Dallas & Plano, Texas

July 2017-Dallas and Plano, Texas

Two Texas firms and three individuals employed by the firms were named in an enforcement proceeding filed by the U.S. Securities and Exchange Commission over the sale of 7% promissory notes issued by Verto Capital Management LLC.

Named as respondents in the Order Instituting the proceedings, are:

  • Retirement Surety LLC-a Plano-based company, which according to its website is a ‘practicing Christian organization” who provide investment advice for retirement planning. This company has never been registered as a broker dealer.
  • Crescendo Financial LLC-a Plano-based company that brokered the sale of the Verto Notes that also touts itself as being a “practicing Christian organization”.
  • Thomas Rose-a 61 year old resident of Plano, TX, who was a partner of Retirement Surety and Crescendo Financial. Rose does not hold any securities licenses and has never been registered as or associated with a registered securities dealer.
  • David Leeman-a 67 year old resident of Dallas, TX, who is also a partner of Retirement Surety and Crescendo Financial. He purports to be a licensed insurance agent in TX, but has never been registered as or associated with a registered securities dealer.
  • David Featherstone-a 70 year old resident of Dallas, TX. He also purports to be a licensed insurance agent in TX, but has never been registered as or associated with a registered securities dealer.

Other relevant individuals in the order are:

  • WIlliam Schantz III, 62 of Moorestown, New Jersey.
  • Randal Wallis, 63 of Pottsboro, TX.
  • Ronald Howard Wills, 71, of McKinney, TX.

According to the SEC the respondents sold $12.5 million of the Verto Notes  to 82 individual investors and collected commissions of over $650,000 on the sales notwithstanding the fact that none of the respondents was registered as a securities broker. Respondents solicited sales on radio shows broadcast on two Christian networks and by use of the Retirement Surety website where the Verto Notes were touted as being a “Short Term Investment with Superior Returns and Minimal Risk”.

Investors who were referred to respondents by a registered stockbroker may be able to recover damages from the brokerage firm employing that broker. 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

Christopher S. Laws-Former BCG Securities Broker-Named in SEC Complaint-Alpharetta, GA

Alpharetta, Georgia

AUGUST 2017 UPDATE-The Securities and Exchange Commission (SEC) charged Christopher S. Laws and three other Atlanta area brokers with fraudulently inducing federal employees to roll over holdings in their federal Thrift Savings Plans (TSP) retirement accounts into higher-fee variable annuity products. Here is a link to the SEC complaint. 

Also named in the SEC complaint are:

  • Keystone Capital Partners Inc. d/b/a Federal Employee Benefit Counselors
  • Jonathan Dax Cooke-Previously with BCG Securities, LPL Financial.
  • Danny S. Hood-Previously with BCG Securities, Summit Brokerage Services, LPL Financial, Valic Financial
  • Brandon P. Long-Previously with BCG Securities and LPL Financial.

 

ORIGINAL POST-June 2017-According to publicly available records Christopher S. Laws , (CRD# 4479529) ,  a  currently unregistered stockbroker who last worked for BCG Securities  , discloses a prior customer dispute, a current regulatory investigation and a termination from employment.

The Financial Industry Regulatory Authority (FINRA) is the agency that licenses and regulates stockbrokers and brokerage firms. FINRA requires brokers and brokerage firms to report customer complaints and disputes as well as regulatory sanctions. In addition brokers are required to disclose certain financial matters such as personal bankruptcies, judgments and liens.

IN 8/2016 the U.S. Securities and Exchange Commission began an investigation alleging that Laws did not make full disclosure that his entity was not affiliated with the federal government when offering investment products to clients and that he improperly notarized customer documents.

In 10/2014, Laws was discharged from LPL Financial who alleged: “concerns regarding business practices, including communications with customers.”

Christopher Laws was employed by BCG Securities 12/2014-4/2017 and with LPL Financial 7/2005-12/20014. Laws discloses a business affiliation with Keystone Wealth Management and Federal Employee Retirement Counselors.

If you have questions about an account handled by Christopher S. Laws, Brandon P. Long, Danny S. Hood or Jonathan D. Cooke 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

SEC Files Emergency Action Against Thurman P. Bryant, III And His Company – Frisco, TX

May 2017-Frisco, TX

On May 15, 2017, the Securities and Exchange Commission filed an emergency action to halt a fraudulent investment scheme which has raised nearly $23 million from 100 investors.

The action alleges that Frisco, Texas resident Thurman P. Bryant, III and his company, Bryant United Capital Funding, Inc. (BUCF), have raised approximately $22.7 million from nearly 100 investors.   These investors were falsely promised a risk-free, guaranteed minimum 30% annual returns on investments that Bryant would supposedly make in the mortgage industry.   Bryant and BUCF also allegedly sent investors monthly statements apparently showing that their initial investment monies were safe in an escrow account.

The SEC alleges that  Bryant  used $4.8 million to cover personal expenses, including rent and luxury car payments, a housekeeper, meals and groceries, private school tuition, horse riding expenses, and for an apartment; used approximately $16.1 for high-risk securities trading among other things.   The SEC also alleges that the monthly account statements were fraudulent.

Link to SEC complaint .

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

 

SEC Shuts Down LottoNet Boiler Room-Pompano Beach, FL

March 2017

The U.S. Securities and Exchange Commission announced the filing of a complaint against Florida based LottoNet Operating Corp. , its CEO David Gray and Joseph A. Vitale, a sales agent for the company.

The SEC alleges that they misrepresented to investors how their money was to be used. According to the SEC about 35% of the money raised was paid to boiler room sales agents and LottoNet allegedly siphoned investor funds for personal spending on clothes, a wedding and strip clubs.

Investors were touted $8,500 monthly returns for a $25,000 investment. About $4.8 million was raised.

The SEC says that Vitale raised about $1.4 million from investors using the alias Donovan Kelly in an apparent attempt to conceal the fact that he had been permanently barred by FINRA. According to his FINRA record Vitale was permanently barred by FINRA in 10/2011. Vitale was last employed in the industry by J.P. Turner & Co. 

Link to SEC complaint.

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

John W. Rafal-Essex Financial Former President/CEO-Sentenced

May 2017

The U.S. Attorney’s Office for the District of Massachusetts announced in a press release that John William Rafal, 67, the former president and chief executive of Essex Financial  has been sentenced to a year of probation for making referral payments to an attorney who referred him a wealthy client. Four months of the probation is to be served in home detention and he was assessed a fine of $4,000.

In January 2017, Rafal entered into an agreement with the Securities and Exchange Commission barring him for life from the securities industry and a fine and disgorgement of over $500,000. The SEC alleged that Rafal and a Connecticut attorney fraudulently schemed to circumvent the rule regarding payments for client solicitations. According to the SEC allegations the client was an elderly widow with accounts worth $100 million.

According to the Investment News, after Mr. Rafal had paid a portion of the referral fee to the attorney, his company found out and directed Rafal to have the attorney return the money, but Rafal then secretly paid the referral fee to the attorney from his private checking accounts.

Essex Financial  has been a FINRA member since 2003 and is headquartered in Essex, CT. Essex Financial is licensed in 48 U.S. states and territories.

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

SEC Warns Investors– Beware of Fake News

April 2017- Washington, DC

The U. S. Securities and Exchange Commission issued an Investor Alert warning that articles on an investment research website appearing to be an unbiased source of information may be part of an undisclosed paid stock promotion designed to promote the sale of the stock.  Link to SEC Investor Alert. 

“Stock promotion schemes may be conducted through investment research websites,” said Lori Schock, Director of the SEC’s Office of Investor Education and Advocacy.  “Investors looking for objective investment information should be aware that fraudsters may use these websites to profit at investors’ expense.”

The SEC recently commenced enforcement actions against companies and individuals for generating deceptive articles on investment research websites. They have charged 27 parties (individuals, public companies, firms and writers) with fraud. See this for more 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