SEC Awards Whistleblowers That Helped Spot Securities Fraud

Investor Alerts Attorney Jared Levy November 18, 2019

The Securities and Exchange Commission (SEC) recently announced a whistleblower award to three people who jointly provided a tip about an undisclosed fraud targeting retail investors. The whistleblowers themselves had been harmed by the fraud. The information that the whistleblowers provided to the SEC resulted in a successful enforcement action. The whistleblowers will receive a collective whistleblower award of over $260,000.

The Chief of the SEC’s Office of the Whistleblower, Jane Norberg, stated: “Because of the whistleblowers’ information and assistance early in the investigation, the SEC had strong evidence about a fraudulent scheme operated by recidivist violators. This matter exemplifies the importance of the SEC’s whistleblower program to the agency’s enforcement efforts and commitment to protect investors.”

Since issuing its first whistleblower award in 2012, the SEC has awarded approximately $387 million to 70 people. The SEC pays all whistleblower awards from an investor protection fund that is funded from fines that securities wrongdoers pay to the SEC.

Whistleblowers may receive an award when they provide the SEC with original, timely, and credible information that results in a successful enforcement action. Whistleblower awards can range from 10 percent to 30 percent of collected fines.

The Dodd-Frank Act requires the SEC to protect the confidentiality and identities of whistleblowers.

Please contact one of our Business Trial Group attorneys at 800-816-1031 if you believe you have information of securities-related fraud that you believe the SEC may be interested in prosecuting. We regularly help tipsters navigate through the whistleblower process.

The Business Trial Group at Morgan & Morgan will never charge hourly fees or expensive retainers. We are only paid if we successfully recover money for you.

The Business Trial Group is part of the largest contingency law firm in the nation, with more than 500 lawyers and 50 offices. We regularly battle against brokerage firms, investment advisory firms, and banks, and have helped investors recover tens of millions of dollars of investment losses.

SEC Investigates Barclays For Its Aggressive Bond Marketing Practices

Investor Alerts Attorney Jared Levy November 12, 2019

It was recently reported that the Securities and Exchange Commission is investigating whether Barclays Plc violated securities laws relating to its marketing practices for certain bonds backed by commercial property.

The SEC’s probe allegedly involves sales in 2018 of bonds backed by hotels. The probe allegedly began after Barclays’ former head of commercial real estate trading and distribution, Brian La Belle, filed a lawsuit over his termination. It has been reported that during the lawsuit’s proceedings, La Belle alleged that Barclays may have committed securities fraud in aggressively marketing a deal for bonds backed by hotels.

La Belle allegedly raised concerns that an independent report on the cost of upgrading hotels tied to the loan may have been improperly altered to make the deal appear less risky, according to Reuters. La Belle alleged that the report was changed after Barclays exerted pressure. La Belle further alleged that Barclays ignored his concerns and disregarded basic risk controls and compliance issues.

La Belle subsequently complained to the SEC, according to legal documents. La Belle was fired in August 2018 and is seeking millions of dollars in lost pay, arguing that he was fired for whistle-blowing.

This is not the first time that U.S. authorities have investigated the bank’s bond sales. Last year, Barclays settled with the Justice Department for $2 billion for its sales of securities backed by residential mortgages before the financial crisis of 2008.

Please contact one of our Business Trial Group attorneys at 800-816-1031 if you believe you have a claim relating to improper bond sales by Barclays or another bank or brokerage firm.

The Business Trial Group at Morgan & Morgan helps investors recover their financial losses on a contingency basis. You will never be charged hourly fees or expensive retainers. We are only paid if we successfully recover money for you.

FINRA Sanctions Summit Brokerage Services for Excessive Trading

Investor Alerts Attorney Jared Levy November 7, 2019

FINRA recently announced sanctions against Summit Brokerage Services, Inc. for supervisory failures relating to excessive trading. Summit has agreed to pay over $880,000 for its supervisory failures, including over $500,000 in restitution to customers whose accounts were excessively traded. According to FINRA, a former Summit registered representative – who FINRA previously had barred – committed the excessive trading.

Specifically, FINRA found that from January 2012 through March 2017, Summit failed to review over 150 alerts that identified the excessive trading. FINRA found that Summit therefore failed to detect that one of its stockbrokers had excessively traded 14 customer accounts, resulting in hundreds of thousands of dollars in commissions. FINRA previously had barred the stockbroker.

“In this matter, the affected customers paid hundreds of thousands of dollars in commissions as a result of the excessive trading that occurred in their accounts,” said Susan Schroeder, FINRA’s executive vice president of the department of enforcement. “This enforcement action reflects the fact that obtaining restitution for harmed customers remains our highest priority.”

If you feel you have been a victim of excessive trading – whether committed by Summit or another brokerage firm – please contact us. Attorneys Jared Levy (561-812-1541) and Aiman Farooq (954-327-3041) will be happy to discuss your potential claims for excessive trading or any investment losses you suffered with a brokerage firm or registered investment advisor.

The Morgan & Morgan Business Trial Group helps investors recover their financial losses on a contingency basis. You will never be charged hourly fees or expensive retainers. We are only paid if we successfully recover money for you.

The Business Trial Group is backed by the size and skill of the largest contingency law firm in the nation – with more than 500 lawyers and 50 offices throughout the country. We regularly battle against brokerage firms, investment advisory firms, and banks, and have helped investors recover tens of millions of dollars of investment losses.

SEC Bars Former LPL Rep Who Misappropriated Investors’ Funds

Investor Alerts Attorney Jared Levy November 4, 2019

The SEC recently barred James T. Booth – a former registered representative of LPL Financial LLC and Invest Financial Corporation (IFC) – after Booth pled guilty to misappropriating nearly $5 million from dozens of investors.

According to the SEC’s order, Booth pled guilty to one count of securities fraud on October 22, 2019 in a federal criminal proceeding before the United States District Court for the Southern District of New York. According to the Indictment, from 2013 through 2019, Booth allegedly told approximately 40 investors that their assets would be invested in securities, but instead used them to pay personal and business expenses. He also used investor moneys to pay other investors. The misappropriated assets totaled $4.9 million.

Booth worked for IFC from December 2005 through February 2018. He then moved to LPL, where he worked until his termination in May 2019. Booth is 74 years old and a resident of Norwalk, Connecticut.

The SEC has barred Booth from associating with any broker, dealer, investment adviser, municipal securities dealer, municipal advisor, transfer agent, or nationally recognized statistical rating organization.

If your funds have been misappropriated by Booth, you may have a claim against Booth or his employers, LPL and IFC. Please contact the Business Trial Group, and attorneys Jared Levy (561-812-1541) and Aiman Farooq (954-327-3041) will be happy to discuss your potential claims.

The Business Trial Group helps investors recover their financial losses on a contingency basis. You will never be charged hourly fees or expensive retainers. We are only paid if we successfully recover money for you.

The Business Trial Group is backed by the size and skill of the largest contingency law firm in the nation, Morgan & Morgan – which has more than 500 lawyers and 50 offices throughout the country. We regularly battle against brokerage firms, investment advisory firms, and banks, and have helped investors recover tens of millions of dollars of investment losses.