Tag Archives: sws financial lawsuit

SWS Financial Services Hit with Suit by Regulators Over Improper Variable Annuity Sales

On September 29, 2014, the Department of Enforcement of The Financial Industry Regulatory Authority (FINRA) filed a complaint against SWS Financial Services, Inc. alleging that from September 2009 to May 2011, SWS had inadequate supervisory systems and written supervisory procedures to supervise sales of variable annuities (VAs).

SWS Financial, headquartered in Dallas, TX,  has been a FINRA member since 1986 and has about 189 branch offices employing 313 brokers.

FINRA alleges that SWS Financial Services, Inc. did not perform adequate reviews of applications for variable annuities and failed to monitor whether annuities were inappropriately exchanged. FINRA also alleges that VAs were sold to customers without a reasonable basis to believe that the investment was suitable.

The sale of variable annuities can be quite profitable for broker dealers and FINRA states that up to 20% of the total revenues of SWS Financial was attributable to the sale of variable annuities for the time frame involved.

According to the SEC:  “A variable annuity is a contract between you and an insurance company, under which you make a lump-sum payment or series of payments. In return, the insurer agrees to make periodic payments to you beginning immediately or at some future date. You can choose to invest your purchase payments in a range of investment options, which are typically mutual funds. The value of your account in a variable annuity will vary, depending on the performance of the investment options you have chosen.”

While variable annuities can be appropriate investments, we often see cases where they are inappropriate if too much of an investor’s liquid net worth is tied up. In addition, there are generally hefty surrender fees if an investor needs or decides to liquidate the annuity, a fact not always understood by investors.

If you or one of your loved ones has questions about an annuity investment you made with SWS Financial, 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

Update On Corpus Christi Broker William C. Mays

 

In December 2013, FINRA announced that William Charlton Mays of Corpus Christi was named in a FINRA complaint alleging that he converted and misused over $30,000 in customer funds by providing funds to his ex-wife and his father without the customer’s authorization. The complaint alleges that Mays told the client he would be investing $50,000 for one year in stocks and commodities, telling him that after a year he could have his principal returned or take an interest in the investment partnership. In addition, the complaint alleges that Mays failed to disclose to his member firm that he was operating an unaproved outside business and failed to amend his U$ to disclose an unsatisfied federal tax lien.
Earlier in the year, in September 2013,  a grand jury in Nueces County, Texas, indicted William Charlton Mays on charges of securities fraud, money laundering, theft and securing the execution of a document by deception. The indictment alleges that Mays made ironclad guarantees to clients to induce them to invest in a purported gold, silver and commodities trading operation. The investments, which were sold in 2011 and 2012, were in the form of promissory notes and investment contracts.
To read the indictment, follow this link.
According to the FINRA Broker Check site, Mays was a registered representative for several FINRA broker dealers, as follows:
  • SWS Financial Services 01/2011-11/2011
  • Summit Brokerage Services, Inc. 04/2009-12/2010
  • LPL Financial Corporation 09/2004-04/2009
If you had an account with Mays and suffered losses, you may be able to recover all or a part of those losses through FINRA arbitration.

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