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Securities Fraud

Former heavy-hitter stockbroker Buck charged with fraud

Former heavy-hitter stockbroker Buck charged with fraud

By Indianapolis Business Journal staff Thomas. J. Buck, a former top investment broker who was fired by the local office of Merrill Lynch in 2015 after nearly 34 years with the firm, is now facing serious prison time, according to federal officials. Buck, 63, has agreed to plead guilty to one count of securities fraud and faces up to 25 years in prison, U.S. Attorney Josh Minkler’s office announced Tuesday morning. Buck also agreed to pay $5 million as part of a civil settlement he reached with the U.S. Securities and Exchange Commission. Federal investigators say Buck defrauded clients by charging excessive commissions...

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Indiana investment adviser sentenced to prison for fraud

Indiana investment adviser sentenced to prison for fraud

From The Indiana Gazette Acting U.S. Attorney Soo C. Song announced Monday that former Indiana investment adviser Bernard Parker was sentenced to 87 months imprisonment, three years supervised release and ordered to pay $1,212,663.93, on his conviction at trial of one count of securities fraud, one count of mail fraud and four counts of filing false tax returns. Parker, 56, was sentenced by U.S. District Judge Reggie B. Walton. According to Assistant U.S. Attorneys Robert S. Cessar and Rachael L. Mamula, who prosecuted the case, the evidence presented at trial established that Parker, the principal of Parker Financial Services, solicited his clients by...

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Never Invest in a Company Started or Managed by Your Stockbroker, Insurance Agent, or Investment Advisor

The United States Securities & Exchange Commission recently sued a Colorado investment advisor for fraudulently convincing his clients to invest in a company he started and owned.  The SEC alleges that the investment advisor misrepresented his credentials, the purported safety of the investments he was selling, and his success in creating and operating such companies in the past.  These poor victims violated a cardinal rule of investing:   You should never invest in any company created or managed by your stockbroker, insurance agent, or investment advisor unless and until: You thoroughly check out the so-called “investment opportunity” by having your CPA...

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Indiana’s Secretary of State’s Efforts to Educate Hoosiers about Securities and Investment Fraud

The Indiana Secretary of State, Connie Lawson, is conducting a “Movie And A Meal” tour around the State of Indiana to educate Hoosiers about securities and investment fraud. The tour features screenings of the documentary “$cammed,” which details the dramatic impact experienced by victims of three major Indiana securities fraud cases. The presentations are free and a meal, either breakfast or lunch, is provided. You do need to RSVP in advance. RSVP by email to Katrina Ent at kent@hirons.com or call her at 317-977- 2206. A list of the upcoming dates and locations are as follows: September 21, 8 – 9:30...

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Three members of The Dane Group sentenced for securities fraud

Three members of The Dane Group sentenced for securities fraud

By Current Publishing -- currentinwestfield.com According to a press release sent to Current from the Office of the Indiana Secretary of the State, all three members of The Dane Group have been convicted of security fraud. The Dane Group is a capital investment firm in Fishers. Bruce McIntyre, Shelly Guzman and Fennis Bledsoe formed the company in 2012 to provide capital to expanding businesses. From 2013-2014, they sold unregistered short-term promissory notes to at least four Hoosiers totaling more than $375,000. According to bank records, the funds were used for personal expenses. Bledsoe was the last of the three to be sentenced, and he...

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Hedge Fund Manager Cops Guity Plea for Multi-Million Dollar Ponzi Scheme

Hedge Fund Manager Cops Guity Plea for Multi-Million Dollar Ponzi Scheme

Recently a Virginia hedge fund manager pled guilty to a $9 million Ponzi scheme. The case dealt with over 50 clients who invested in the investment manager’s hedge fund where he bragged of earning returns regularly beating the S & P 500. In reality, he both spent his clients’ monies on his living expenses and used the monies to cover losses he generated in trading activities. In typical Ponzi scheme fashion, he used new investor funds to pay off older investors who decided to cash out....

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Jury Awards $15 Million in Punitive Damages Against MetLife for Ponzi Scheme Involvement

Last year MetLife and one of its subsidiaries were assessed $15 million in punitive damages by a jury for its failure to discover one of its agents was selling unregistered securities along with life insurance policies. The unregistered securities were actually promissory notes which were allegedly invested in a $200 million Ponzi scheme. The plaintiff, Christine Ramirez, claimed that MetLife’s subsidiary New England Life Insurance Company had an agent who was selling her these unregistered securities at the same time he was selling her life insurance. ...

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What is the “Fraud-on-the-Market” Doctrine of Securities Fraud?

In the United States Supreme Court case of Basic, Inc. v. Levinson, 485 U.S. 224 (1988), the Court ruled that in certain circumstances a securities class action would be appropriate notwithstanding what otherwise would be individualized issues of reliance.  Basic created the Fraud-on-the-Market Doctrine. The Fraud-on-the-Market Doctrine pertains to the reliance element of the federal section 10(b) claim.  Because 10(b) claims require reliance, courts historically had found class wide treatment was inappropriate in Section 10(b) claims because individualized reliance issues would predominate, precluding class certification under Federal Rule 23(b)(3).  In Basic, the United States Supreme Court created a solution to this...

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SEC’s Office of Compliance Inspections and Examinations Identifies Frequent Advisor and Brokerage Firm Shortcomings

Starr Austen & Miller has represented over a thousand victims of either investment advisor negligence or stockbroker fraud.  In almost every case the guilty advisor or broker failed to comply with his firm’s own compliance manual.  Typically, such conduct has been ongoing for years and the brokerage firm has chosen to pay lip service to its compliance rules and procedures by not truly watching its broker with sufficient care or otherwise properly supervising the broker’s bad conduct.  In essence, the compliance manual becomes a worthless piece of paper the brokerage firm shows the regulators in an effort to show that...

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Indiana settles with securities firm over agent who ran Ponzi scheme

By: Indianapolis Business Journal Staff and Associated Press The state has reached a $275,000 settlement with NYLife Securities LLC over the activities of an Indiana wealth manager who killed himself in 2013 while being investigated for operating a Ponzi scheme that took millions of dollars from dozens of investors. Indiana Secretary of State Connie Lawson announced the settlement Thursday. Former NYLife agent Richard Schwartz operated a Kokomo-based company called RAS & Associates that sold investments totaling $16.3 million to 53 Indiana investors. The state says most of that money was never invested but went to support Schwartz’s “extravagant lifestyle” and an apparent gambling problem. Attorney...

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