LPL FINANCIAL FINED BY FINRA FOR SELLING MUNICIPAL AND CORPORATE BONDS AT UNFAIR PRICES

Boston, Massachusetts based LPL Financial LLC submitted a Letter of Acceptance, Waiver and Consent in which the firm consented to, but did not admit to or deny, the described sanctions and the entry of the Financial Industry Regulatory Authority's (FINRA) findings that it purchased municipal securities for its own account from a customer and/or sold municipal securities for its own account to a customer at an aggregate price (including any commission or service charge) that was not fair and reasonable. Factors taken into consideration were the best judgment of the broker-dealer or municipal securities dealer as to the fair market value of the securities at the time of the transaction and of any securities exchanged or traded in connection with the transaction; the expense involved in effecting the transaction; the fact that the broker-dealer or municipal securities dealer is entitled to a profit; and the total dollar amount of the transaction. FINRA also stated that in corporate bond transactions, the firm failed to use reasonable diligence to ascertain the best inter-dealer market and failed to buy or sell in such market so that the resultant price to its customer was as favorable as possible under prevailing market conditions. The firm was censured and fined $60,000.

Broker-Dealers have a duty of best execution, which requires that they seek to obtain for its customers' orders the most favorable terms reasonably available under the circumstances. The obligation also provides that in any transaction for or with a customer, a member and persons associated with a member shall use reasonable diligence to ascertain the best inter-dealer market for a security and buy or sell in such market so that the price to the customer is as favorable as possible under prevailing market conditions. If broker-dealers do not use reasonable diligence to obtain the best price for their customers, they may be liable for damages resulting from unreasonable execution. Therefore, investors who have suffered damages due to purchases and/or sales of securities at unreasonable prices can bring forth claims to recover those investment losses against broker-dealers like LPL Financial, which should have prevented the above described misconduct.

Have you suffered losses in your LPL Financial LLC account? If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation. Mr. Pearce is accepting clients with valid claims against LPL Financial LLC stockbrokers who may have engaged in stockbroker misconduct and caused investment losses.

The most important of investors' rights is the right to be informed! This Investors' Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over 33 years, Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities and investment law issues. The lawyers at our law firm are devoted to protecting investors' rights throughout the United States and internationally! Please visit our website, www.secatty.com, post a comment, call (800) 732-2889, or email Mr. Pearce at pearce@rwpearce.com for answers to any of your questions about this blog post and/or any related matter.

HUEL COX JR. BARRED BY FINRA FOR MISAPPROPRIATING CUSTOMER'S FUNDS

Huel Cox Jr., a former broker at Duluth, Georgia based PFS Investments, Inc., submitted a Letter of Acceptance, Waiver and Consent in which he consented to, but did not admit to or deny, the described sanction and the entry of the Financial Industry Regulatory Authority's (FINRA) findings that he misappropriated a customer's funds for his own personal use. According to FINRA's findings, Mr. Cox solicited a friend, who was also a customer of his member firm, to make various investments in real estate and a casino. The customer agreed to make the investments and, over a period of years, wrote personal checks payable to Mr. Cox. FINRA found that Mr. Cox did not make any of the promised real estate investments for the customer. Further, it found Mr. Cox misappropriated at least $206,398.89 of the customer's funds for his own personal use without the customer's authorization. Mr. Cox, of Phoenix, Arizona, was barred from associating with any FINRA member in any capacity.

Broker-dealers must establish and implement a reasonable supervisory system to protect customers from stockbroker fraud and other stockbroker misconduct. If broker-dealers do not establish and implement a reasonable supervisory system, they may be liable to investors for failure to supervise and the damages flowing from the misconduct. Therefore, investors who have suffered damages due to prohibited activity such as misappropriation of funds can bring forth claims to recover losses against broker-dealers like PFS Investments, which should monitor their brokers' activities in order to prevent the above described illegal conduct.

Have you suffered losses in your PFS Investments account due to misappropriation of funds by your broker? If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation. Mr. Pearce is accepting clients with valid claims against PFS Investments stockbrokers who may have engaged in stockbroker misconduct and caused investment losses.

The most important of investors' rights is the right to be informed! This Investors' Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over 33 years, Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities and investment law issues. The lawyers at our law firm are devoted to protecting investors' rights throughout the United States and internationally! Please visit our website, www.secatty.com, post a comment, call (800) 732-2889, or email Mr. Pearce at pearce@rwpearce.com for answers to any of your questions about this blog post and/or any related matter.

MICHAEL PALAZZO FIXED INCOME 1 FUND INVESTIGATION BY ROBERT WAYNE PEARCE, P.A.

The Law Offices of Robert Wayne Pearce, P.A. is currently investigating an alleged Ponzi scheme perpetrated by Michael Palazzo, a former Tonawanda, New York based stockbroker at Berthel Fisher & Company Financial Services, Inc. Mr. Palazzo's former customers are alleging that he fraudulently solicited investments in Fixed Income 1 Fund as a part of his plot to misappropriate funds. Sales practice allegations by customers against Mr. Palazzo and his employer have been filed. The Financial Industry Regulatory Authority (FINRA) recently reported a June 3, 2013 complaint made by former customers inquiring whether the investments they made through Mr. Palazzo were legitimate. FINRA also reported a June 7, 2013 complaint by former customers against Mr. Palazzo alleging churning, misapppropriation of funds, and a misrepresentation related to the terms of a variable annuity contract. In addition, the June 7, 2013 complaint alleged that Berthel Fisher failed to supervise Mr. Palazzo's activities.

The Law Offices of Robert Wayne Pearce, P.A. are investigating where Michael Palazzo engaged in a "Ponzi scheme," an unsustainable fraud pyramid that inevitably ended in ruin. Schemers use money raised from latter investors to pay an earlier investor's returns. Ponzi schemes invariably fall apart when markets deteriorate or when the schemer is unable to raise more cash. "Selling away" is the inappropriate practice of an investment professional who sells or solicits securities or investments not held, approved, or authorized by the brokerage firm with which the professional is associated. Under NASD and FINRA rules, brokerage firms must approve investments offered by their investment professionals and supervise its sales. Broker-dealers have been held liable for "Ponzi schemes" perpetrated by their registered sales representatives.

Broker-dealers must establish and implement a reasonable supervisory system to protect customers from stockbroker misconduct. If broker-dealers do not establish and implement a reasonable supervisory system, they may be liable to investors for damages flowing from the misconduct. Independent broker-dealers have been criticized for their lax supervisory practices and procedures, which oftentimes leaves investors vulnerable to sales of securities that have not been reviewed or authorized by anyone other than the sales representative earning a commission.

Have you suffered losses in your Berthel Fisher account due to Michael Palazzo and the Fixed Income 1 Fund and/or any other questionable investments? If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation. Mr. Pearce is accepting clients with valid claims against Berthel Fisher stockbrokers such as Michael Palazzo who may have engaged in misconduct and caused investment losses.

The most important of investors' rights is the right to be informed! This Investors' Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over 33 years, Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities and investment law issues. The lawyers at our law firm are devoted to protecting investors' rights throughout the United States and internationally! Please visit our website, www.secatty.com, post a comment, call (800) 732-2889, or email Mr. Pearce at pearce@rwpearce.com for answers to any of your questions about this blog post and/or any related matter.

FINRA SANCTIONS GLOBALINK SECURITIES, INC. AND JUNHUA MICHAEL LIAO FOR FAILURE TO CONDUCT ADEQUATE DUE DILIGENCE OF PRIVATE PLACEMENT OFFERING

Pasadena, California based GlobaLink Securities, Inc. and Junhua Michael Liao submitted a Letter of Acceptance, Waiver and Consent in which the firm and Mr. Liao consented to, but did not admit to or deny, the described sanctions and the entry of the Financial Industry Regulatory Authority's (FINRA) findings that the firm, acting through Mr. Liao, executed an agreement to market and sell a Regulation D offering of promissory notes for Medical Capital Holdings Inc. (Med Cap) without performing adequate due diligence. FINRA's findings stated that the firm sold $1,260,049 of the Med Cap notes to some customers, and these sales generated approximately $56,700 in commissions for the firm. The findings also stated that as the firm's chief compliance officer and president throughout the relevant period, Mr. Liao was responsible for ensuring that the firm established, maintained, and enforced a supervisory system and written supervisory procedures (WSPs) reasonably designed to achieve compliance with applicable laws, rules, and regulations.

FINRA included findings that the firm maintained WSPs pertaining to the sales of private placements, but the WSPs were inadequate in that they lacked specifics concerning how the firm would conduct due diligence, process private placement transactions, ensure that a Regulation D product was suitable for investors, and document the firm's decisions and actions regarding private placement transactions. As a result of the firm's deficient supervisory system and WSPs, FINRA found the firm failed to conduct adequate due diligence on the offering. Further, that the failure to conduct due diligence prevented the firm and Mr. Liao from learning that the issuer had experienced payment problems on earlier note offerings and thus, the private placement memorandum (PPM) misrepresented the issuer's past performance. GlobaLink Securities was fined $20,000 jointly and severally with Mr. Liao. Mr. Liao, of San Gabriel, California, was also suspended from association with any FINRA member in any principal capacity for one month - the suspension was in effect from June 3, 2013 through July 2, 2013.

Broker-dealers must establish and implement a reasonable supervisory system and WSPs governing adequate due diligence of investments they intend to market and sell. If broker-dealers do not establish such systems and procedures, they may be liable to investors for damages. Therefore, investors who have suffered damages in the Med Cap private placement can bring forth claims to recover their investment losses from GlobaLink Securities, which should have performed adequate due diligence prior to offering and selling the investment to its customers. Have you suffered losses in your GlobaLink Securities, Inc. account? If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation.

The most important of investors' rights is the right to be informed! This Investors' Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over 33 years, Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities and investment law issues. The lawyers at our law firm are devoted to protecting investors' rights throughout the United States and internationally! Please visit our website, www.secatty.com, post a comment, call (800) 732-2889, or email Mr. Pearce at pearce@rwpearce.com for answers to any of your questions about this blog post and/or any related matter.

KIMBERLY ANN SPRINGSTEEN-ABBOTT NAMED IN FINRA COMPLAINT FOR ALLEGEDLY MISUSING INVESTOR FUNDS

Kimberly Ann Springsteen-Abbott, a broker at Clearwater, FL based Commonwealth Capital Securities Corp., was named a respondent in a Financial Industry Regulatory Authority (FINRA) complaint alleging that she directed the misuse of investor funds to pay for various credit card charges that were not related to legitimate business purposes of the funds. The complaint alleges that the charges relating to the misused investor funds consisted of personal expenses for Ms. Springsteen-Abbott and another individual. The allegedly misused funds totaled at least $344,798.79, and some of the charges have been refunded. The complaint also alleges that in connection with a FINRA examination, Ms. Springsteen-Abbott and her firm provided a false and back-dated document in connection with the documentation provided regarding the credit card charges. By allegedly creating the false and back-dated documentation, Ms. Springsteen-Abbott, of Holiday, Florida, caused her firm to maintain inaccurate books and records.

Broker-dealers must establish and implement a reasonable supervisory system to protect customers from broker misconduct. If broker-dealers do not establish and implement a reasonable supervisory system, they may be liable to investors for damages flowing from the stockbroker misconduct. Therefore, investors who have suffered damages due to prohibited activity such as misuse or misappropriation of funds can bring forth claims to recover losses against broker-dealers like Commonwealth Capital Securities Corp., which should monitor their brokers' activities in order to prevent the above described misconduct.

Have you suffered losses in your Commonwealth Capital Securities Corp.? If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation. Mr. Pearce is accepting clients with valid claims against Commonwealth Capital Securities Corp. stockbrokers who may have engaged in misconduct and caused investment losses.

The most important of investors' rights is the right to be informed! This Investors' Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over 33 years, Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities and investment law issues. The lawyers at our law firm are devoted to protecting investors' rights throughout the United States and internationally! Please visit our website, www.secatty.com, post a comment, call (800) 732-2889, or email Mr. Pearce at pearce@rwpearce.com for answers to any of your questions about this blog post and/or any related matter.

JOHN SEAN KENNEDY FINED AND SUSPENDED BY FIRNA FOR VIOLATING FIRM'S WRITTEN SUPERVISORY PROCEDURES

John Sean Kennedy, a former broker at Staten Island, New York based Chelsea Financial Services, submitted a Letter of Acceptance, Waiver and Consent (AWC) in which he consented to, but did not admit to or deny, the entry of the Financial Industry Regulatory Authority's (FINRA) findings that he participated in a private securities transaction without his firm's approval. Mr. Kennedy informed the customer of an opportunity to invest in a promissory note issued by a publicly-traded company and facilitated the customer's signing of a $100,000 promissory note by withdrawing $100,000 from the customer's IRA, without informing his firm of his participation in the transaction. These actions were contrary to his firm's written supervisory procedures (WSPs), which prohibited its associates from participating in private securities transactions without the firm's prior written approval. FINRA's findings stated that Mr. Kennedy, without his firm's knowledge or consent, served as president, officer, and registered agent of a corporation contrary to his firm's prohibition from participating in an outside business activity without prior firm approval. The findings also stated that Mr. Kennedy failed to file federal and state tax returns for four years which, represents unethical conduct and is inconsistent with just and equitable principles of trade. Mr. Kennedy, of Encino, California, was fined $15,000 and suspended from association with any FINRA member in any capacity for eight months. The fine must be paid either immediately upon Mr. Kennedy's re-association with a FINRA member firm following his suspension, or prior to the filing of any application or request for relief from any statutory disqualification, whichever is earlier. The suspension is in effect from June 3, 2013 through February 2, 2014.

Broker-dealers must establish and implement a reasonable supervisory system to protect customers from stockbroker misconduct. If broker-dealers do not establish and implement a reasonable supervisory system, they may be liable to investors for damages flowing from the misconduct. Therefore, investors who have suffered damages due to unauthorized outside investment recommendations by their broker can bring forth claims to recover investment losses against broker-dealers like Chelsea Financial Services, which should monitor their brokers' activities in order to prevent the above described illegal conduct.

Have you suffered losses in your Chelsea Financial Services account? If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation. Mr. Pearce is accepting clients with valid claims against Chelsea Financial Services and its stockbrokers who may have engaged in misconduct and caused investment losses.

The most important of investors' rights is the right to be informed! This Investors' Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over 33 years, Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities and investment law issues. The lawyers at our law firm are devoted to protecting investors' rights throughout the United States and internationally! Please visit our website, www.secatty.com, post a comment, call (800) 732-2889, or email Mr. Pearce at pearce@rwpearce.com for answers to any of your questions about this blog post and/or any related matter.

JAMES GLENN TALLANT NAMED IN FINRA COMPLAINT FOR CHURNING

James Glenn Tallant, a broker at Purchase, New York based Morgan Stanley Smith Barney, was named a respondent in a Financial Industry Regulatory Authority (FINRA) complaint. The complaint alleges that Mr. Tallant exercised control over the customer's accounts by engaging in discretionary trading without written authorization. Mr. Tallant also allegedly exercised de facto control because the customer routinely followed Mr. Tallant's advice and was unable to evaluate Mr. Tallant's recommendations and to exercise independent judgment. FINRA alleged the trading was unsuitable and excessive in size and frequency. The complaint also alleges that the number of transactions in the accounts was excessive in light of the customer's investment objectives and resulted in turnover and cost/commission-equity ratios exceeding those that create a presumption of churning. The complaint further alleges that Mr. Tallant executed or caused the execution of the securities transactions with intent to defraud, and that he knew, or was reckless in failing to recognize, that the trading in the accounts resulted in substantial commissions for him but could not reasonably be expected to benefit the customer. By allegedly executing the improper transactions in the customer's accounts, Mr. Tallant, of Abilene, Texas, allegedly placed his own interests above the customer's interests.

Broker-dealers must establish and implement a reasonable supervisory system to protect customers from stockbroker misconduct. If broker-dealers do not establish and implement a reasonable supervisory system, they may be liable to investors for damages flowing from the misconduct. Therefore, investors who have suffered damages due to prohibited activity such as unauthorized discretionary trades and/or churning can bring forth claims to recover investment losses against broker-dealers like Morgan Stanley Smith Barney, which should monitor their brokers' activities in order to prevent the above described misconduct.

Have you suffered losses in your Morgan Stanley Smith Barney account? If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation. Mr. Pearce is accepting clients with valid claims against Morgan Stanley Smith Barney stockbrokers who may have engaged in misconduct and caused investors losses.

The most important of investors' rights is the right to be informed! This Investors' Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over 33 years, Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities and investment law issues. The lawyers at our law firm are devoted to protecting investors' rights throughout the United States and internationally! Please visit our website, www.secatty.com, post a comment, call (800) 732-2889, or email Mr. Pearce at pearce@rwpearce.com for answers to any of your questions about this blog post and/or any related matter.