Tag Archives: Illinois

William P. Carlson of Elhert

On February 21, 2017, he Securities and Exchange Commission charged William P. Carlson, Jr., a Deerfield, IL investment advisor with misappropriating more than $900,000 from a client’s account through more than 40 unauthorized transactions.  Deerfield is in the Chicago-area.

The SEC alleges that Carlson, an investment advisor representative associated with the Ehlert Group in Lincolnshire, forged a client’s signature on checks and journal requests and caused checks to be issued from the client’s account to a third party who gave the proceeds to Carlson.

Carlson had discretionary authority to place trades in the victim’s accounts. Such trades, involving the purchase and sale of mutual fund shares, were supposed to be made pursuant to a model asset allocation portfolio selected by the client based on advice from Carlson. When requested by the client, Carlson could direct disbursement of funds held in the accounts to the client. In order to disburse funds held in the accounts for the benefit of a third party, the Broker-Dealer holding the funds required a written request signed by the client.

On at least sixteen different occasions from November 2012 to April 2014, Carlson directed that a check made payable to the client be issued from the client’s account, purportedly based on instructions Carlson had received from the client. The check amounts ranged from $6,500 to as much as $97,000, and collectively totaled $437,000.

In approximately June 2014, Carlson changed his method of making unauthorized withdrawals from the client’s account. Carlson began forging the vicitm’s signature on “Check and Journal Request” forms that directed the Broker-Dealer to make disbursements of funds held in the client’s account to a third party who was a friend of Carlson’s.

In March 2015, Carlson forged the vicitm’s signature on a letter of authorization and a notarized signature sample letter permitting the firm holding the funds to issue checks from the victim’s account to Carlson’s same friend, without the need for further check and journal requests that required additional client signatures.

Between approximately June 2014 and December 2016, through the use of these forged authorizations, Carlson caused at least 25 checks—ranging in amount from $10,000 to $35,000 and collectively totaling $474,000—to be issued from the client’s account to Carlson’s friend, who in turn gave the proceeds to Carlson.

The Complaint of the SEC can be found at the following link.

Losses with Maczko of Wells Fargo

If you invested with Matthew Maczko, a broker with Wells Fargo Advisors in Oak Brook, Illinois and suffered losses that you question, please call 1-866-817-0201 for a free and private consultation with an attorney concerning your rights.

Wells FargoMaczko was suspended from the securities industry last week, the week of February 7, 2017, for alleged excessive trading in the brokerage accounts of a 93-year-old customer, according to a FINRA. Maczko effectively controlled the customer’s accounts, which had an average aggregate value of $3 million.

Maczko’s trading  generated more than 2800 transactions resulting in $582,000 in commissions, $84,270 in fees and approximately $397,000 in trading losses for the account in question. Such trading activity was not only churning but was also unsuitable for Maczko’s victim given the customer’s age, risk tolerance and income needs.

Maczko also intentionally mislead FINRA regulators and investigators by telling them during testimony that he had not spoken to  other senior customers after his termination from Wells Fargo, when in fact he had spoken with them several times.

Securities brokers are required to follow the rules of FINRA.  FINRA requires that investments not only be suitable in terms of the nature of the investment, but also that the investments be quantitatively suitable.  This means that the number of trades cannot be excessive in light of the wants and needs of the customer.  Above a certain level, the trades can be seen as not being for the benefit of the customer, but for the broker.

The trades of Maczko went well beyond the acceptable number of trades.

John Burns, Ameriprise, UBS Loss Recovery

John Burns of St. Charles, MO, and formerly of Ameriprise, UBS, Edward Jones and Sagepoint, submitted an agreement settling a regulatory suit in which he was assessed a deferred fine of and suspended from association with any FINRA member in any capacity for 14 months.  Such regulatory actions rarely work to compensate injured investors and injured investors should speak to an attorney concerning their losses.  If you believe that you have suffered losses, or believe the offer to settle your matter is too low, call 1-866-817-0201 for a free initial consultation with an attorney.

Without admitting or denying the findings, Burns consented to the sanctions and to the entry of findings that he engaged in a pattern of unauthorized trading in customer accounts and made unsuitable, risky investments for a senior couple. The findings stated that Burns did not have written discretionary authority to place trades in any of these customer accounts. In some of UBSthe customer accounts, Burns executed the trades without any authorization, while in other customer accounts, Burns had some verbal authorization to exercise discretion generally, but exceeded that verbal authorization by executing trades in excess of the available funds in the account. The findings also stated that Burns made unsuitable and unauthorized investments over a twoyear period in the account of a senior retired couple, both of whom were over 65 years old. These transactions involved repeated high-risk investments in small drug company stocks which were unsuitable for the customers’ moderate risk tolerance and investment profile. The customers sustained losses in all but one of these investments in an aggregate amount exceeding $50,000.

Burns has also been the subject of five lawsuits in recent years filed by investors concerning the mishandling of their accounts.

Tobin Joseph Senefeld

FINRA  has announced that  Tobin Joseph Senefeld, formerly of PIN Financial, a Carmel, Indiana brokerage firm owned by Veros Partners, has been barred from associating with any FINRA member institution, according to its monthly disciplinary report released last week. The sanction is related to a Securities and Exchange Commission suit that claimed Senefeld and two others operated a multimillion-dollar Ponzi scheme involving farm loans.

FINRAThe SEC case claimed the three raised $15 million from 80 investors in 2013 and 2014 to fund farm loans. New investor funds were used to pay older investors when the loans went bad.

Senefeld has a long history of misconduct.  The FINRA and SEC actions are just the latest of his legal problems.  The record of Senefeld contained on FINRA’s BrockerCheck indicates that Senefeld has 27 disclosure events dating back to 1997.

The prior misconduct of Senefeld, also known as “disclosure events,” include a substantial number of state regulatory actions, including the revocation of his license by Michigan in 2000 and other regulatory punishment by 16 other jurisdictions around the same time.  Senefeld also had a long history of tax liens, terminations, and civil suits initiated against him by other investors.

Co-defendants in the present SEC matter, Matthew D. Haab and Jeffrey B. Risinger, both have settled the civil suit for about $184,000 and $100,000, respectively. Senefeld and the SEC failed to reach a settlement at an in-person meeting Oct. 28, according to court filings, so Senefeld’s case remains on course for trial.

Senefeld, PIN and Risinger have all received lifetime bans from the securities industry by FINRA.

Recovery for Jean Walsh-Josephson Losses

If you were an investor of Jean Walsh-Josephson, please call 1-866-877-0201 for a free consultation concerning potential recovery for your losses.

broker in handcuffsJean A. Walsh-Josephson was a financial advisor for Thrivent, formerly Thrivent Financial for Lutherans.  A Winnebago County judge has ordered a two-week trial for this former Oshkosh, Wisconsin financial adviser who accused of stealing $4 million from her mostly elderly investment clients.

The trial for Walsh-Josephson is set for Feb. 20 through March 3, 2017. Judge Thomas Gritton ordered the trial this week, days after victims and their families gathered in court May 13 for what they were led to believe would be a plea and sentencing hearing.

Walsh-Josephson faces 28 counts of theft in a business setting of more than $10,000 each after authorities say she stole more than one million dollars from at least seven clients in Winnebago and Outagamie counties. She also faces felony forgery misdemeanor theft and obstructing an officer charges after authorities say she stole $400 from a client while acting as a third-party intermediary in a property dispute.

If convicted on all charges, she could face a maximum sentence of 287 ½ years in prison.

The question for investors is the question of why Thrivent did not detect this level of theft.  All firms have a duty to take reasonable steps to detect and prevent broker theft.

Jeffrey Pederson has handled numerous cases concerning the theft and outside activity of brokers and have helped investors obtain favorable judgments and settlements.  Please call for a free consultation.

Oil or Gas Investment Losses

Oil Stock IIJeffrey Pederson, P.C. helps investors determine if they have a right to recover investment losses in oil, gas or other investments.  Please call 1-866-817-0201 toll-free for a free consultation.

In 2016, oil dropped to a price below $30 a barrel.  Many investors simply ignore their losses, believing that the loss is simply due to the market, without knowing that they may be entitled to a recovery.  Such individuals unnecessarily let their plans for retirement or other future plans go unfulfilled because of the financial loss they sustained.

Since late 2014, countless oil, gas and other energy companies have filed for bankruptcy.  Many investors in these companies were illegally sold these investments by brokerage firms motivated by commissions paid by the investments.  Such investments can take many forms including, but not limited to, Master Limited Partnerships (MLPs), common stock, notes, bonds, mutual funds, and Exchange Traded Funds (ETFs).

We are currently investigating investments into the following energy companies:Oil Stock

American Eagle, BPZ, Buccaneer, Climax Energy, Duer Wagner, Hart Resources, Hercules Offshore, Linn Energy, Milagro Oil and Gas, Petrobras, Quicksilver Resources, Sabine, Samson Resources, Sandridge Energy, Southern Pacific, Walter Energy and WBH Energy.

Oil and gas limited partnership losses can do more than take away the hard earned principal of investors, it can also create tax liabilities that the investor was not expecting.  The result is that the investor could lose more than invested.  The following link discusses the risks that in more detail.

Jeffrey Pederson has represented investors in Alabama, Arizona, Arkansas, California, Colorado, Connecticut , Florida, Hawaii, Massachusetts, Montana, New Jersey, New Mexico, New York, North Carolina, Minnesota, Missouri, North Dakota, Rhode Island, Texas, Utah, and Wyoming, in FINRA arbitration actions against securities brokerage firms for unsuitable investments.  Please call for a confidential and free consultation.

 

 

 

Variable Annuity Fraud

We help investors who believe that they are victims of variable annuity fraud.  Variable annuity fraud has always been a frequent trick of brokers looking to put their own interests ahead of their investors (often by selling to those approaching retirement which is generally an unsuitable recommendation).  The investments pay an extremely high commission and the investments are only suitable for a small section of the investing public.  This fraud hit a new low last week.

As reported in http://www.investmentnews.com/article/20140313/FREE/140319954, the Securities and Exchange Commission Thursday, March 13, 2014, filed charges against a group of brokers in a scheme wherein investors used variable annuities to wager on the lives of the terminally ill.

The brokers in question were Michael A. Horowitz of Los Angeles and Moshe Marc Cohen of Brooklyn, N.Y.

The brokers allegedly obtained the personal health and identification data of the dying patients through fraud, marking them as annuitants on variable annuity contracts that he had marketed to wealthy clients, according to the SEC’s complaint.  Under false pretenses, the brokers allegedly received their employers’ approval to sell the annuities.  The motivation with this plan, as with most fraudulent sales of variable annuities was the commission.  Variable annuities pay as large of a commission as just about any investment product that you can purchase through a securities brokerage.  The brokers reaped approximately $1 million in commissions from their sale, the SEC claimed, with Mr. Horowitz obtaining more than $300,000 and Mr. Cohen became unjustly enriched to the tune of more than $700,000.

If you have lost money with these or any other brokers you believe may have defrauded or mismanaged you portfolio call 303-300-5022.