October 21, 2011

Many American’s are struggling to keep their homes; in Hollywood, Pembroke Pines and Fort Lauderdale, others have lost jobs and can’t find work. Are people going to be able to spend less if they have nothing to spend? Are the banks ready to lend to jobless people, as they increase fees for withdrawals and various banking transactions? I was taught at an early age that 1+1=2 but 0+0 equals nothing because there is no value in zero.

Now that the Mortgage Industry has somewhat stabilized, so we are led to believe, our financial industry should build-up, right? Are the spending dollars available? Or is it just a dream we wish to pursue in some distant future? As we look into the financial and securities industry we see fraud and mismanagement everywhere. The number of homes across the country that received initial default notices, (which is the first step in the foreclosure process), according to the foreclosure listing firm RealtyTrac, jumped 33 percent in August from July. This average includes cities such as; Hollywood, Margate, Pompano Beach and Coral Springs. Is there any way fix the mistake? Banks, mortgage companies or investment brokers made and to find out if they falsified documents that caused the holes in our economy.

So the “milking effect” has begun…we have less to spend, and yet we are milking from the working, the productive, and the wealthy. Our economic “leaders” expect to replace revenue by “milking”, for what others no longer contribute into our economy. For most people this makes no sense. There are people with no jobs, or struggling to live in homes of their own. People in general need to be employed and productive, in order to earn an income and contribute, not incur more debt and fees making the already bad economy, worst. How are we are going to grow our economy if we use every bit of “parked” wealth and “parked” money to mend it? Can we continue to exhaust our investments to this cycle of loss? Who protects the investments? Is there any hope for the Financial Investors and Securities? “No use crying over spilled milk.” But with these hard times, also come people who exploit investors and commit fraud using investment firms. We can only try to do the best with what we have and hope for growth of the economy in our time.

Will FINRA or the SEC help me if I've been the victim of broker fraud?

October 20, 2011

The securities industry, through its lobbying efforts, has succeeded in creating a wall between broker misconduct and recovery by federal agency action: the SEC and FINRA will not and administratively cannot help you recover from a claim of fraud by your stockbroker. The result is that the federal agencies charged with regulating the securities industry does not and will not recover losses by investors in 99% of the claims. If you complain to the SEC, and the complaint has merit, it will open an investigation. The ultimate result of an SEC investigation may be an enforcement proceeding or fine imposed on the financial advisor or the brokerage house. The SEC will not recover losses for individuals, it will only impose fines, with a few exceptions that for your purposes means the agencies might as well not exist if you claim broker fraud, most claims of broker mis-conduct such as placing your money into investments that are not proper for your investment goals, excessive risk, and most of the abuses we find brokers committing on their clients.

The SEC receives around 50,000 complaints every year. The SEC takes action on lesson 100 complaints every year. FINRA receives about 5000 complaints a year. And like the SEC takes action on only a few hundred. These actions may result in broker discipline or the filing of charges against the brokerage house. It will not resolve with a recovery for the losses of an individual investor. Recovering losses is not designated as a governmental function in the United States. Recovery of losses due to stockbroker fraud is done through the arbitration process or in some special cases permitted lawsuits in federal court.

Security fraud lawyers in South Florida, Boca Raton and Fort Lauderdale, will appear before the securities regulating agencies to press for losses incurred by their clients. If you open a trading account in any stockbroker firm and he subsequently believe you have a claim for broker fraud or misconduct: your only recourse is arbitration. Securities fraud lawyers deal primarily in representing victims of financial advisors.

Ameriprise Sued by It’s Own Financial Planners

October 19, 2011

Ameriprise, the financial services giant, an organization which employs more certified financial planners than any other entity in United States, was sued by six people; including one current employee. The accusation in the suit suggests that Ameriprise has been overweighting its own expensive mutual funds, which have been performing below-market, into its own 401(k) plans. The financial services press has been billing this as a frustration for Ameriprise because its own mutual funds have been highlighted as poor performers which it is forcing on its own financial planners. One of the charts produced in the press, shows fees are 3 to 5 times higher than at other competing funds, such as Vanguard. If you feel that your stockbroker or financial planner has been infusing your investment portfolio with inappropriate investments contact a South Florida securities fraud attorney. Most security fraud lawyers in Fort Lauderdale, Boca Raton, West Palm Beach, and Miami, can, with a quick office visit, look at your monthly statements and give you a fair evaluation of which investments are appropriate for your risk tolerance. This type of review is especially important for those of us who are in our retirement years and rely on our investments for income to support our daily lives.

What duty does a Stockbroker owe to his/her Client?

October 18, 2011

All stockbrokers are regulated by FINRA, which licenses and disciplines both stockbrokers and the brokerage firms that they work for. These federal securities laws and rules concern themselves with the suitability of security transactions for each individual customer. Stockbrokers must have a reasonable basis for any recommendation for the purchase or sale of any securities. The rules do not create any presumption that a transaction is appropriate, but each individual transaction must be suitable for the investor and their risk tolerance. The rules concerning transactions with customers, which regulate stockbrokers in South Florida, Fort Lauderdale, Miami, and West Palm Beach, require both transparency and justification for any recommendation or transaction. Your stockbroker, if he or she is in a nation franchise, or recognized traditional Wall Street brokerage house, is supervised both by the stock broker office manager and the compliance department. Regulations concerning transactions advised or performed at the request of investors are always subject to review. If you feel that you have been placed in an inappropriate high risk investment, contact a South Florida securities lawyer. FINRA has offices in South Florida, Boca Raton, where they undertake and conduct arbitrations. If you feel you have been victimized by stockbroker. If you believe that you are in a high risk and inappropriate investment due to stockbroker advice. If you feel you've been victimized by stockbroker fraud call a South Florida securities law firm and get a free consultation about your remedies available through arbitration.

Penalty Bid Rule needs to be overhauled

July 18, 2011

It is illegal to fix the price or control the price of any security; that rule is one of the basics of a fair marketplace, and the function of government regulation, i.e. FINRA, is to make, or create, the perception that the market is fair to all bidders. With the vast amount of cash looking for a home the expected boom in underwriting and new issues is exploding, and market makers have sounded the call for FINRA to change the Penalty Bid Rule. Pitting market makers and issuers of new securities against savvy investors, this will be a bloody battle. Penalty bidding permits the underwriter to fix the bottom price on any new issue during initial distribution. Also known by its evil-twin name “pegging” it is permitted under SEC Rule 10b-7 but only for syndicate managers and underwriters of new issues. Fixing prices of securities is the antithesis of fair markets and the implausible arguments used by FINRA to support the Penalty Bid Rule are under attack. Keep tuned for more follow-up on this page. If your financial advisor has been pegging your account then you have the right to file a complaint. Contact a securities fraud lawyer in South Florida for more information about abuses and corrupt practices of financial advisors if you feel like you have been the victim of securities professional.

What is FINRA and what became of the NASD ?

July 15, 2011

FINRA is the Financial Industry Regulatory Authority; it regulates securities firms in the United States. FINRA licenses and oversees the over 630,000 men and women in the securities industry. Its mission is to make sure the industry operates “fairly and honestly”. Overseeing over 4500 brokerage firms with over 160,000 branch offices is a big job. Most of us see the job as poorly done, do you agree?
Congress is paying the 3000 employees of FINRA to oversee, regulate and make “fair and honest” the entire spectrum of the financial securities industry in the U.S. FINRA is the “champion” of the small investor. OK?
If you want to contact FINRA you can write them at 1734 K Street, Washington, DC 20006, or call them on the telephone at (301) 590-6500. I do it all the time; they do actually answer the phone. There is a broker hotline where you can check out the history of your financial advisor: call the hotline at 1-800-289-9999, or go online to the FINRA homepage and go to the broker-check area. You’ll see a brief history of the advisor’s credentials and complaint(s), if any. The NASD was dissolved and its job taken over by FINRA.

How to Win a Claim against Your Broker

July 7, 2011

Don’t tell anyone, but it’s all in the paperwork. Remember when you signed up with that superstar? Remember the forms? Where are they? Did you keep them?
When I speak with clients the mantra is save your paperwork. Here’s why…..when you signed up with your “top” broker you filled out some forms about your risk tolerance. Risk tolerance? Yep! And when you file a FINRA claim against your fallen “superstar” over some Estonian CDO Hedge Fund that went long on Madoff notes….you want to parade in front of the FINRA arbitrators your risk tolerance as very low. If you don’t have your intake forms where are they? Your rising “star” has it in his computer and will promptly buy a new hard drive when you file with FINRA. So, here’s the deal…here’s what to do:
Call your “brilliant” broker’s Sales Assistant today, not tomorrow, and tell him/her you are re-building your paper files and need a copy of the original intake forms you signed. Get it today, before the market dips and you sing a chorus of the hobo broke blues. If you don’t you’ll be with the other 30,000,000 out of work and broke Americans who are living la dolce vita life on unemployment checks….for sixteen weeks…..then to the Church commissary for some canned vegetables. Get your paperwork today and I’ll greet you in my office with the good news that the claim was settled and here’s your check.

Goldman and JP Morgan cut deals with the SEC

July 5, 2011

Is beauty truth, or truth beauty or does it matter to JP Morgan? The SEC began legal action against JPMorgan Securities for not disclosing material facts to investors about a CDO vehicle. Sounds familiar? It should because recently Goldman Sachs was taken to the woodshed over the same issue. Not to worry, the woodshed won’t hurt too much as the money is small.
JPMorgan settled with a $156.3 million dollar check, Goldman Sachs settled for $550 million dollars. Whasss up? It’s all about failing to inform investors that a hedge fund was created and they were short. Oooopps.
No executives were tagged on this one and the penalty was corporate, so no real pain, and no changes. The street goes on and on and on.
The only refutation came from commentators who didn’t like the disparity….between $550 million and $156 million. Bloomberg spoke on this saying JP Morgan was given favored treatment, others pointed out, correctly, the differences in the case(s).
The SEC said nothing and went back to what it does so well…..doing very little.

Is Bank of America Hiding Foreclosure Information?

March 24, 2011

Currently in news e-mails were released that were allegedly provided by a former employee of Balboa for Bank of America, claiming to have records showing to what extent a division of the bank sought to conceal information about foreclosures. These new findings may iniciate a mortgage fraud investigation by the authorities.

The former Balboa employee, revealed the emails from the company who deals in force-placed insurance coverage on mortgages, working closely with Countrywide Financial and as such, Bank of America, who bought Countrywide a few years ago.

A Bank of America spokesman reported to Reuters that the documents had been stolen by the former Balboa employee, and were not tied to foreclosures. “We are confident that his extravagant assertions are untrue,” the spokesman said.

The e-mails between employees at Balboa depicted a few concerns that raised eyebrows and questions:

“The following GMAC DTN’s need to have the images removed from Tracksource/Rembrandt,” wrote an operations team manager at Balboa. DTN refers to document tracking number, and Tracksource/Rembrandt is an insurance tracking system. The response he received was: “I have spoken to my developer and she stated that we cannot remove the DTNs from Rembrandt, but she can remove the loan numbers, so the documents will not show as matched to those loans.”According to the e-mails, approval was agreed to remove the loan numbers from the documents.

This is a very serious allegation being that many people in Miami, Fort Lauderdale and Palm Beach are getting mailings regarding the obligation to pay a force-placed insurance applied in error or for some reason unexplained when they have paid an insurance bill separate from the mortgage for years. Many people have contacted mortgage fraud attorneys because of the recently released information from mortgage companies, in the past few months an increasing number of people being foreclosed upon have encountered a force-placed insurance applied to their loans. It is possible the general public is being taken advantage of in some way according to some of the comments about the information.

Statistics Don’t Lie/Liars Use Statistics: FINRA published numbers

February 22, 2011

FINRA has some interesting numbers to share: you can decide what it means: Investor Complaints for 2006: 5,671 and for 2010: 3,208. What that means is that complaints of broker fraud, broker abuse, and broker misdeeds go up and down with the market. In 2009 there were 5,067 and then in 2010 3,208. Does that mean that stock brokers are not abusing client funds? Or does it mean something else? A rising tide lifts all boats or, like doctors who bury their mistakes in graveyards, brokers who churn client funds or place them in high risk investments don’t get complaints because the client is making money. No touch no foul in a rising market means there’s a lot of misdeeds that will surface when the market “corrects”. If, when, the market drops most of you will be searching on your statements for broker fraud, don’t bother: call a South Florida stock broker fraud lawyer and ask him or her to look over your statements. Not all stock broker corrupt acts appear on your statement, like a good criminal they try to cover their tracks. I’ve been on their track since 1976 and I have a good nose, so you should call for a free consultation. Another interesting FINRA statistic is over 70% of arbitration claims resolve with an award for the claimant. So if you believe you have been the victim of stock broker fraud, or you’ve been placed in investments that are high risk (example: a retiree who owns CDOs or IPO’s) then call a stock broker fraud lawyer here in Florida.