Category Archives: Conflict of Interest

Texas Regulators Revoke Gus Marwieh’s Securities Registration-Austin, TX

October 2019 – Austin, Texas 

Texas Securities Commissioner, Travis Iles, revoked the registration of  Gus Marwieh  for fraud related to the sale of pension investments, according to a news release from the Texas State Securities Board (TSSB). 

According to the release Marwieh, who was president of Marwieh Advisory Services in Austin, fraudulently sold over $5 million in investments without disclosing excessive commissions, misuse of client funds and conflicts of interest.

The TSSB inspection of Marwieh’s books and records revealed that Marwieh primarily recommended investments in either Future Income Payments (FIP) supposedly based on payouts from pensions, and promissory notes from real estate developers which were supposed to pay 18% annually.

The TSSB found that Marwieh collected commissions on sales of these two products in excess $300,000 and violated his fiduciary duty by not disclosing conflicts of interest to his customers and by using escrowed funds to pay personal expenses.

Link to TSSB Disciplinary Order. 

About the TSSB, from their website:

The State Securities Board is responsible for administering and enforcing the Texas Securities Act. The agency is overseen by five Board members appointed by the Governor, with the advice and consent of the Senate, for six-year overlapping terms. The Board adopts and periodically updates rules to ensure that investors are adequately protected and that unreasonable burdens on legitimate capital-raising activities are avoided. The Board appoints a Securities Commissioner who serves at its pleasure and serves as the agency’s chief administrative officer and supervises the day-to-day activities of the staff.

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.

International Representation

Rex Securities Law

TollFree: 877-224-3199

Florida-561 391 1900 

Texas-512-329-2870

Tamara Steele- Former Comprehensive Asset Management and Servicing Broker-Named in SEC Suit Over Behavioral Recognition Systems-Pendleton, Indiana

October 2018- Pendleton, Indiana

According to publicly available records Tamara R. Steele   (CRD#3227494) ,  a  stockbroker who was last registered with Comprehensive Asset Management and Servicing (CAMAS)  a/k/a Aurora Private Wealth or APW Capital, Inc.  disclose a pending SEC action, 7 pending customer disputes, 2 final customer disputes 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 September 2018 the United States Securities and Exchange Commission (SEC)  filed an action against Tamara Steele and her solely owned corporation, Steele Financial alleging 12/ 2012 -10/2016, Steele and Steele Financial, both Indiana based investment advisors, fraudulently recommended and sold to their advisory clients over $13 million in extremely risky securities issued by a private company, Behavioral Recognition Systems (BRS).  In violation of their fiduciary duties of loyalty of good faith, the SEC alleges that they failed to disclose to their clients that BRS had agreed to pay them  commissions ranging from 8% to 18% of the funds raised for BRS.  BRS Labs later became Giant Gray.  By this fraud, Steele and Steele Financial profited at the expense of their clients.   The SEC seeks disgorgement, penalties and an injunction.

Several customers have settled cases with Steele’s firm over the BRS investment.

In March 2018, May  2018 and in June 2018, customers with APW Capital, Inc.( aka Aurora Private Wealth and formerly known as Comprehensive Asset Management and and Servicing (CAMAS),  filed customer disputes against Steele alleging “outside business activities, selling away and private securities transactions, unsuitable investments, negligent account management, violation of the Indiana Securities Act, Violation of Registered Investment Advisor Section of Indiana Securities Act, Sale of unregistered and non-exempt securities, breach of fiduciary duty, violations of FINRA conduct rules and NYSE Board Rules”.   Alleging damages of $124,757.53, $500,000 and $200,000 respectively,  these three cases are all still pending.

In June of 2017,  Tamara Steele was discharged from her position with Comprehensive Asset Management and Servicing (CAMAS).   According to allegations on her FINRA record “Through a phone call to  CAMAS by her attorney, Ms. Steele self-reported having participated in private securities transactions for multiple clients without prior notice and approval from CAMAS.  Our internal review confirmed the facts of Ms. Steele’s self-report.”

Tamara Steele was employed with Comprehensive Asset Management and Servicing, Inc.  from January 2009 until July 2017. She is not currently registered with any broker dealer.

If you have questions about an investment account handled by Tamara Steele, contact us for a no charge consultation to learn about 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

Lewis (Buddy) Rogers-Raymond James Broker-Former Client Awarded Over $250K For Unsuitable MLP Investments-Dallas, TX

March 2018-Dallas, Texas

Lewis H. Rogers, a broker who has worked for Raymond James & Associates since 2/2013, discloses on his FINRA records that an all public FINRA arbitration panel in Houston has ordered  Raymond James & Assoc to pay one of Roger’s former clients over $250,000 for losses (including attorney fees and interest) suffered in their accounts, which included an IRA.

The former clients alleged that they received recommendations to invest in inappropriate investments, including master-limited-partnerships, MLPs. The former clients alleged that their accounts were over concentrated in these unsuitable investments and that Raymond James did not disclose its conflict of interest as a major underwriter of at least two of the MLPs. Mosley, et al vs. Raymond James & Assoc. FINRA Case 16-03199. 

FINRA is the Financial Industry Regulatory Authority, the agency that licenses stock brokers and stock brokerage firms. Disputes over the mishandling of a brokerage account are generally resolved in FINRA arbitration, a process that is much more expedient and far less costly that court based litigation.

Stockbrokers have a duty to make recommendations that are suitable for the customer, taking into account the customer’s age, investment objectives and risk tolerance.

If you have suffered losses in your brokerage account and feel that you were misled as to the risks associated with the investments causing the loss, call for a no charge consultation.

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

Nicolaas P. Pronk-Noble Capital Named in Complaint Over Sale of AdCare Health Systems Stock-Boca Raton, FL

November 2016-Boca Raton, FL

According to publicly available records Nicolaas P. Pronk , (CRD# 1726101) ,  a  stockbroker who is employed by  Noble Capital Markets,  disclose  a pending regulatory matter.

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.

Pronk is named in a FINRA complaint alleging that he and Noble Financial Capital Markets violated securities laws by soliciting seven customers to purchase nearly a million shares of  stock in AdCare Health Systems (ADK) without disclosing the firm’s multiple and material conflicts of interest.

According to the complaint filed in FINRA Case #2013035740901, Pronk and Noble Capital Markets promoted and recommended ADK to prospective investors to profit from Noble’s undisclosed investment banking relationships with AdCare and their undisclosed arbitrage of AdCare securities, which created a financial incentive to recommend ADK to customers. Pronk retained ultimate control over all firm activities including proprietary trading, sales, investment banking, and the decision to initiate and prioritize the promotion and sale of ADK.

Nicolaas Pronk has been registered with Noble Capital Markets since 1988 and he acts as Noble’s CEO, COO, CFO and President.

Noble Capital Markets has been registered since 1984, is headquartered in Boca Raton, FL, and has 5 branch offices with 38 registered individuals.

If you have questions about an account in an account at Noble Capital Markets , contact us 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

United Development Funding Offices Raided by FBI- Grapevine, Texas

February 19, 2016- Grapevine, Texas

The FBI raided the offices of United Development Funding (UDF) yesterday causing the shares of its largest fund United Development Funding IV to fall over 50%, before trading was suspended. In December 2015 UDF IV was trading at over $17. At the time of this writing it is trading at just over $3.

UDF

UDF IV 90 Day Chart

 

UDF is based in Grapevine, Texas, and was founded in 2003. The company sells shares to investors and loans the money to real estate companies. Over $1 billion has been raised by UDF from mostly individual investors, many of which are older retired individuals who purchased the UDF  real estate investment trusts (REITs) seeking safe, dependable fixed income.

The Wall Street Journal (WSJ) published an article earlier this week that highlighted risks related to the UDF business model, including the following:

  • UDF IV Loans are Concentrated Geographically– while also operating in North Carolina, South Carolina and Florida, 99% of the UDF IV portfolio consists of loans made to borrowers in Texas, which is contrary to representations made to investors that UDF IV has portfolio diversification by submarket and loan type. Closer examination reveals that 68% of the loans are in the Dallas area, the WSJ reports.
  • UDF IV Loans are Concentrated to Single Borrower– 67% of its loans are to a single borrower, Centurion American Development and its affiliates.
  • UDF III Loans are Concentrated Geographically– 86% of its loans are secured by Texas properties.
  • UDF V Loans are Concentrated Geographically– 100% of it loans are secured by properties in Texas.

Recovery Option for Investors Who Suffered Losses on UDF 

Brokers have a duty to make suitable recommendations to investors. You may be able to recover damages from the brokerage firm that sold you the investment if the recommendation was not suitable for you taking into account your age, health and level of financial sophistication.

Brokers also have a duty to conduct an independent due diligence review of investments before offering the product for sale.

Call to discuss how you may be able to recover damages through FINRA arbitration, a process much more expedient & efficient than court litigation.

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