Monthly Archives: June 2018

Attention Kenny Kim, IFG Investors

If you were an investor of Kyusun “Kenny” Kim of IFG, please call 1-866-817-0201 to speak to an attorney about your rights for recovery.  Most cases are handled on a contingency basis, where the attorney does not receive fees unless there is a recovery.

Mr. Kim has been accused, and ultimately barred from the securities industry, by regulators  for systematically committing securities violations in the accounts of senior investors for the time period of 2006 through 2015.  He is accused of both of recommending unreasonably risky, or unsuitable investments, to senior investors, and of falsifying the documents of the investors to allow him to convey to his supervisors that the recommendations were suitable.

Invest photo 2As a broker, Mr. Kim’s actions are governed by the Financial Industry Regulatory Authority (FINRA).  FINRA has a suitability rule that requires that a broker have a reasonable basis for believing that a recommended transaction or investment strategy is suitable for the customer based on the customer’s investment profile, which includes, among other factors,
the customer’s age, financial situation and needs, investment experience, and risk
tolerance.

Kim was selling alternative investments to seniors.  Alternative investments are investment other than stocks, bonds and mutual funds.  They include REITs that do not trade on a stock exchange and structured notes.  Though structured notes may look like bonds or mutual funds, such investments contain a derivative component that make the investment extremely risky and speculative in nature.  An investor may need to speak to an attorney just to confirm an investment is actually a structured note.  Such recommendations were improper for investors with conservative or moderate risk tolerances.

Adding to the risk, Kim improperly recommended that many of the investors unreasonably concentrate their portfolios in these alternative investments.  This only increased the level of speculation in the portfolio.

This is only the latest chapter in a long history of regulatory actions and customer lawsuits.  FINRA has indentified 23 investor lawsuits, either filed or threatened, concerning Kim.

While Mr. Kim has been expelled from the securities industry, this does little to compensate investors who have lost their life savings.  Jeffrey Pederson has represented investors across the country in similar suits in front of FINRA.  Please call for a free and confidential consultation.

 

MVP REIT Loss Recovery

If you lost money in MVP REIT I, MVP REIT II or Parking REIT, please call 1-866-817-0201 to speak to a lawyer about potential loss recovery.  Most cases are handled on a contingency basis, where the attorney does not receive fees unless there is a recovery.

The Financial Industry Regulatory Authority (FINRA) is investigating whether MVP American Securities violated federal securities laws or the authority’s rules when it raised money from investors from 2012 to 2017.  This was disclosed in a corporate filing filing with the Securitites and Exchange Commission concerning Parking REIT, the subsequent entity of MVP REIT I and II.

Michael Shustek, through MVP American, raised approximately $180 million from sales of MVP I and II.  Though the exact nature of the investigation is still unknown, the most likely violation would be the sale of the investments with an undisclosed conflict of interest.The investigation does not only concern MVP American, but also Shustek.

investingstockphoto 1Other reports critical of Shustek and MVP state the two engaged in behavior that was abusive to investors.  This was done by having the REIT buy and sell the same six properties repeatedly, with little to know economic motivation to do so.  More details concerning this investigation can be found in the Las Vegas Review Journal.

These highly aggressive investment may also be unsuitable for investors seeking only moderate risk or retirement income.  The sale of such an unsuitable investment is a securities violation and may entitle an investor to recovery of losses.

This is not the first time Shustek has been in trouble with securities regulators.  In 1999, Nevada regulators investigated him for potential securities violations in running Del Mar Mortgage.  He has also been previously investigated by the SEC for his dealings with Vestin real estate for utilizing misleading information in sales presentations.

Jeffrey Pederson represents investors around the country in arbitrations in front of FINRA.  Please call for a free initial consultation.

Steve Knuttila investor recovery

If you were an investor with Steve Knuttila please call 1-866-817-0201 to discuss your options for investment loss recovery.  Jeffrey Pederson represents investors nationwide in issues of investment mismanagement and investment fraud.

Mr. Knuttila has recently lost his securities license and has come under the scrutiny of Minnesota securities regulators after a long history of defrauding investors and mismanaging the life savings of people.  FINRA, the Financial Industry Regulatory Authority, discloses the number of “disclosure events” a broker receives.  Such events include regulatory investigations, investor lawsuits and written investor complaints concerning a broker.  Four such disclosure events require a brokerage to give a broker heightened supervision or terminate a broker.  In the case of Mr. Knutilla, he has over 20 such disclosure events.

Knuttila has previously worked with a Questar and Capital Financial Services.  Both these firms have potential liability for the actions of Knuttila.  The history of disclosure events made the hiring and continued employment of Knuttia questionable.

Invest photo 2The beginning of the end for Knuttila was in 2017.  In November 2017, FINRA, the regulator overseeing stockbrokers nationwide, began an investigation into allegations that Knuttila made unsuitable recommendations to customers. The sale of unsuitable investors is a form of negligence and can be a form of fraud.  On May 10, 2018, FINRA staff sent a request to Knuttila for on-the-record testimony pursuant to FINRA Rule 8210. As stated in his phone call with FINRA staff on May 21, 2018, and by this agreement, Knuttila acknowledges that he received FINRA’s request and will not appear for on-the-record testimony at any time.  FINRA barred Knuttila from the securities industry.

On April 2, 2018, the Minnesota Department of Commerce issued a Consent Order permanently barring Knuttila from engaging in the sale or offering of securities and any related securities activity in the State of Minnesota, revoking his insurance producer’s license, and fining Knuttila $40,000, of which $30,000 was stayed, based upon findings that Knuttila made misrepresentations and omissions of fact, breached his fiduciary duties, and made unsuitable recommendations in connection with the sale of securities.

 

Tags:  Knutilla, Knutttila, CFS, Minnesota, Minot, North Dakota, Perham.

 

 

Christopher Wendel Investors

If you are an investor suffering losses with Christopher Wendel, please 1-866-817-0201 for a free consultation.  Mr. Wendel has been implicated in the improper sale of Woodbridge  notes and other securities violations.  Jeffrey Pederson has represented investors nationwide in cases concerning Woodbridge and other similar securities actions.

Wendel solicited investors to purchase promissory notes in Woodbridge Mortgage Investment Funds, a purported real-estate investment fund.  Wendel did not provide notice to SA Stone Wealth Management, his employer, prior to participating in these private securities transactions, nor did he obtain approval from SA Stone.  Despite the lack of notice, SA Stone had a duty to investigate and approve securities sales to prevent its representatives from “selling away.”

Invest photo 2Investment firms are liable for not following FINRA’s strict guidelines concerning the monitoring of representatives to ensure the representatives do not sell unapproved investments, such as Woodbridge.  Common knowledge within the securities industry is the fact that representatives often seeks to sell investments that are unapproved for either the higher commissions or illegal kickbacks that the investments provide.  The problem is that the increased compensation is because the investments either are financially unsound or, in some cases, based upon fraud.

Additionally, there were glaring issues  in these Woodbridge investments for an extended period of time.    These issues should have been discovered during reasonable due diligence by the brokers and agents selling the Woodbridge investments.  These investments should have been recognized as not being suitable for any investor.

The U.S. Securities and Exchange Commission SEC had been investigating Woodbridge since 2016.  Woodbridge, the Sherman Oaks, California-based Woodbridge, which calls itself a leading developer of high-end real estate, had been under the microscope of state regulators even longer.   The focus of these regulators was the possible fraudulent sale of securities.

In 2018, FINRA found that Wendel violated FINRA Rules by providing a false written response and testimony concerning one of the private securities transactions.

This is not the first time Mr. Wendel has been accused of handling the funds of others improperly.  The record of Mr. Wendel shows the six private lawsuits have been initiated concerning his actions.  He has also previously been investigated by SA Stone for the sale of unapproved securities, a common form of fraud.  He was also terminated for the sale of securities that were unapproved by SA Stone.   We believe those securities were Woodbridge securities.  SA Stone apparently allowed several months to elapse before taking action concerning the sale of Woodbridge.