Jeffrey Gitterman is a financial advisor with Vanderbilt Securities. In July 2023, Gitterman’s employers were serve with their eighth demand for arbitration in the last four years. Like the others, the demand alleged inappropriate actions by Gitterman. These many suits range in alleged damages from several thousands and of dollars to several million.
The number of suits concerning Gitterman is important, not only because the suits show a propensity to mistreat investors, but also because they show a need for his employers to provide heightened supervision to Gitterman. Generally, four customer complaints triggers the need to give an advisor heightened supervision.
The complaints concerning Gitterman allege the recommendation of alternative investments that were unsuitable for the investor. A financial advisor, also referred to as a securities broker, has a duty to only recommend investments that are consistent, or suitable, with the objectives and risk tolerances of the investor. A speculative investment for a moderate investor would be unsuitable for that investor.
Alternative investments are investments that are more unique than common stock or bonds. The uniqueness can make them hard to understand and created extremely high risk. Some financial advisors recommend such investments despite an investor’s inability to understand because more aggressive investments often pay a higher commission. Alternative investments commonly pay a commission over 7% while shares of publicly traded stock pay a commission of less than 1%.
In addition to serving as a securities broker, Gitterman has handled the funds of individuals as a registered investment adviser. This means that his responsibilities to investors is greater than that of a securities broker.
In addition to working for Vanderbilt, Gitterman worked as a broker and adviser for Triad Advisors.
We have helped hundreds of investors nationwide recover losses due to inappropriate actions and poor investment management. Please contact use for a free and confidential initial consultation.
Daniel Beech received a Wells notice, the initiation of a regulatory investigation, from FINRA in July 2023. FINRA is the Financial Industry Regulatory Authority overseeing the securities brokerage industry at the direction of the Securities and Exchange Commission.
The Wells Notice stems from an inappropriate splitting of fees with a non-financial advisor. FINRA determined preliminarily that Beech deserved discipline for violating regulatory rules concerning payment of fees to unlicensed individual for the sale of securities in a manner that violated the standards of commercial honor set by the regulator.
Beech is also currently the subject of 15 lawsuits by investors against his current or previous employers. The lawsuits stem from misrepresentations of investments. The investments were a level of risk inconsistent with the level of risk sought by his investors. This is commonly referred as a “suitability violation.”
Each security recommendation from a financial advisor is legally required to be suitable for that investor. Representing an investment inaccurately as to risk is fraud. An example would be the representation of a speculative investment, such as a REIT, as moderate risk.
Further, the failure to disclose that an investment is inconsistent with an investor’s risk tolerance is not only a fraudulent non-disclosure but also a violation of FINRA rules. FINRA requires that a financial advisor know the investor and only make recommendations consistent with the investor’s risk tolerance and investment objectives.
Daniel K. Beech worked as a financial advisor since 2013. He initially worked Royal Alliance and Independent Financial. However, most of his misdeeds appear to have occurred while under the supervision of Western International.
Contact us if you were an investor of Beech. Investment fraud exists because of its difficulty to detect. Many investors are victims of fraud without knowing it. We have helped hundreds of investors determine whether fraud exists in their portfolio. Initial consultations are free and confidential.
Murat Kartal, formerly of Spartan Capital, is alleged to have engaged in churning of senior and unsophisticated client accounts. If you were a Kartal client and believe he handled your account inappropriately, please contact us for a free and confidential initial consultation.
Financial Advisors like Kartal are required to follow the rules of the Financial Industry Regulatory Authority (FINRA). FINRA rules state that “an associated person (such as a financial advisor) must have a reasonable basis to believe that a recommended transaction or investment strategy involving a security or securities is suitable for the customer, based on the information obtained through the reasonable diligence of the member or associated person to ascertain the customer’s investment profile.”
The purpose of this rule is so that financial advisors do not place their own interests ahead of their clients. That is what happens when an advisor makes excessive trades. The cost of such trades eliminates the possibility that the trades serve the objectives of the investor because the cost of the trading hinders the ability of the account to be profitable for the investor. Excessive trading generates a better profit for the advisor than the investor.
Kartal’s record reveals he first became registered with a member firm as a General Securities Representative in April 2015. He then became registered as a representative with Spartan Capital Securities from February 2017 to December 2022. On December 22, 2022, Spartan Capital filed a Uniform Termination Notice for Securities Industry Registration terminating Kartal’s employment with the firm. Although Kartal is no longer registered or associated with a FINRA member firm, he remains subject to FINRA’s jurisdiction as does his former employer for inappropriate supervision.
The U.S. Justice Department indicted Caz Craffy, a former broker with Newbridge Securities, who served as a financial counselor with the U.S. Armed Forces. Craffy is alleged to have defrauded millions from two dozen Gold Star families, according to the U.S. attorney for the District of New Jersey, and court documents. Please contact us if you believe you are a victim by calling toll free 1-844-253-4848.
The federal suit charges Caz Craffy (aka “Carz Craffey”) of Colts Neck, New Jersey with six counts of wire fraud and one count each of securities fraud, making false statements in a loan application, committing acts furthering a personal financial interest, and making false statements to a federal agency.
From May 2018 to November 2022, in his securities broker capacity, Craffy obtained nearly $10 million from Gold Star families to invest in accounts he managed in his private capacity. Once in control of their money, Craffy repeatedly executed trades, often without the family’s authorization.
Craffy profited handsomely from the trades. The unauthorized trades resulted in high commissions. During the timeframe of the alleged scheme, the accounts of the Gold Star families lost roughly $3.6 million, while Craffy personally earned more than $1.4 million in commissions from the family accounts.
“Stealing from Gold Star families whose loved ones made the ultimate sacrifice in service to our nation is a shameful crime,” Attorney General Merrick B. Garland said in a statement.
Craffy is permanently barred from the securities industry. This will do little for the victims, but the victims do have other recourse. Contact us and we can discuss the options to recover the losses in a free and confidential initial consultation. If we do represent you, payment for the representation will be on a contingency fee basis.
Call 1-844-253-5858 if you invested with John Hoidas. Initial contacts are free and confidential. Jeffrey Pederson has handled hundreds of similar cases over the past 20 years.
The Financial Industry Regulatory Authority (“FINRA”) in July 2023 suspended Hoidas from the securities industry for 18 months. The suspension stems from the fraudulent actions that Hoidas made in the accounts of his investors.
Between January 6, 2017, and February 8, 2018, Hoidas made unsuitable recommendations in speculative alternative investments to three of his investors. These recommendations were inconsistent with the customers’ investment profiles. This is in violation of FINRA Rules 2111 and 2010 which require investment recommendations to be consistent with the wants and needs of investors.
Unsuitable investments are often made because higher risk investments generally pay higher commissions.
Additionally, in July 2018, Hoidas borrowed $10,000 from one of his UPS customers without providing prior written notice or obtaining written approval from UPS in violation of FINRA Rules 3240 and 2010.
These are just some of the actions against Hoidas. The record of this Chicago-area financial advisor reveal that he or his employer has been sued ten times since 2019 over the inappropriate investment activity of Hoidas.
Brokerage firms are required to adequately supervise their financial advisors. When they fail to do so investors have grounds to seek recovery. So when an advisor like Hoidas mishandles the accounts of his investors the brokerage firm is required to compensate the investors of Hoidas.
The Securities and Exchange Commission (the “SEC”) filed a Complaint against Defendants Surage Kamal Roshan Perera (“Perera”) and Janues Capital Incorporated (“Janues”) (collectively, “Defendants”), and Relief Defendant Nishani Alahakoon (“Alahakoon”), alleges that Perera, a former broker, through his firm Janues, defrauded at least one investor out of millions of dollars. This is in addition to the individual suits filed by FINRA and individual investors against Perera and his associates.
Jeffrey Pederson has successfully represented hundreds of investors over the past 20 years in securities fraud cases. Please contact the Law Offices of Jeffrey Pederson for a free and confidential initial consultation if you believe you are a victim. Call toll-free at 1-844-253-5858.
Perera committed fraud by lying to investors about investment opportunities and strategies; stealing the investor’s money by, in part, not purchasing the securities she subscribed to through Janues and using a substantial portion of her money to engage in high volume, highly leveraged trading in other securities; lying to her about non-existent investment profits; and concealing large trading losses.
Perera falsely told at least one investor that his brokerage, Janues, had access to specific restricted securities at discounted prices though connections with large institutions. Perera also claimed to exercise an “options straddles” strategy that would not only prevent any trading losses but also guarantee returns on the investment of at least nine percent and up to as much as 50 percent.
Perera’s false representations convinced at least on investor to give him approximately $4.3 million. Perera did not use the investor’s funds to purchase the securities the investor had subscribed to, and Perera did not engage in the promised “options straddles” to prevent trading losses and generate the profits he had guaranteed. Instead, Perera transferred at least $3.5 million of the investor’s funds to a brokerage account in the name of Perera’s wife, Alahakoon, and Perera used those funds to engage in highly speculative, leveraged trading.
In total, Perera’s trading in securities transactions in his wife’s brokerage account resulted in over $3 million in trading losses. Perera concealed his misappropriation of the investor’s funds and his trading losses by providing the investor with phony trade confirmations and account statements that falsely showed the expected returns, and by using funds received from other sources to partially repay the investor victim.
Regulators banned Dennis Ayre from the securities industry on June 12, 2023. He failed to cooperate with regulatory investigations into his actions and defend allegations concerning his sale of unsuitable investments to his investors.
We have prosecuted claims on behalf of hundreds of investors over the past 20 years to recover losses for similar actions. Please contact us.
Ayre spent his career with numerous securities brokerage firms. Most recently he was with Hilltop, but has previously been with Oppenheimer, Merrill Lynch, and Wells Fargo.
The record of Dennis Ayre reveal that his employers have been the subjection of 12 lawsuits concerning the action of Ayre.
The first suit served in October 2019 sought $11 million in losses. The allegations were that Ayre sold unsuitable investments, took excessive risk and deviated from an agreed strategy. The resolution was a settlement of over $600,000.
Many similar allegations and settlements followed. In addition to suitability allegations, Ayer has also been accused of overconcentrating portfolios in Foresight Energy and Integrated Advisor Network.
Ultimately, the Financial Industry Regulatory Authority entered an arbitration judgment against Ayers. The award was for $322,648. The suit alleged that Ayers concentrated an investor in Foresight Energy. The arbitrators issued the award in December 2020. When Ayer refused to pay, regulators investigated his actions and when he did not defend he was barred from the securities industry.
The story of Dennis Ayre is common. Even though brokers sometimes do not pay their employers are still responsible for their actions. We help investors obtain recovery from both brokers and their employers.
We help investors recover Blackstone losses. The Blackstone REIT, the BREIT, is known to have multiple problems. Recent misrepresentations, mismanagement and lack of due diligence has caused investors to suffer unnecessary losses. Please contact us if you suffered losses in the Blackstone BREIT, Multi-Strategy Fund, or other Blackstone funds for these or other issues.
Advisors either knew or should have known of the problems with Blackstone for years but continued to sell to investors. These issues made the investment unsuitable for most, if not all, investors. Many turned a blind eye because of the heightened commissions paid for the sale of non-traded REITs like Blackstone – commissions substantially higher than paid for a portfolio of stocks and bonds.
This can be viewed either as a negligent omission or a failure of due diligence. Either way, advisors are responsible when losses occur in such investments.
A Blackstone marketing graphic contained an error concerning its REIT (“BREIT”). This is just one of many problems with this REIT. The graphic promises inflated after-tax yields and tax-equivalent yields. The SLCG Economic Consulting Group identified the error and published its findings in May 2023. Blackstone removed the representation shortly thereafter. The erroneous representation first appeared in October 2022. The graphic reported a 3.7% pre-tax, 3.6% after-tax and 5.7% tax equivalent yield. BREIT claimed a 4.5% after-tax yield and a 7.1% tax-equivalent yield as of March 31, 2023.
The correct after-tax yield as of March 31, 2023 for the I shares was no more than 3.6%, not 4.5% as BREIT claimed and the tax-equivalent yield for the I shares was no more than 5.7%, not 7.1% as BREIT claimed.
BREIT claimed an after-tax yield that ignored the capital gains taxes which, at a minimum, would be due in the future on the distributions which were largely being treated as a return of capital.
BREIT has had numerous issues in the past year. SLCG identified in December 2022 that the Blackstone BREIT was ether going to crash or collapse slowly. This was in response to Blackstone announcing that it would only honor redemption requests of 2% a month and 5% a quarter. Blackstone blocked or limited redemptions for the ninth consecutive time on August 1, 2023.
BREIT continued to experience issues through the end of 2023. Anticipating its demise in 2023, entities began shorting BREIT. This was due in part to BREIT’s continued efforts to limit liquidation. As of December, 2023, BREIT limited withdrawals for 13 straight months. BREIT announced at the end of 2023 that it suffered the worst loss in its history.
If you are in BREIT and have suffered losses or cannot liquidate your shares, please call for a consultation.
Similarly concerning are the Losses in the Blackstone Multi-Strategy Fund. The assets of this fund dropped nearly 90% from 2019 through 2023. Blackstone is closing this fund.
Six investors have already filed suit against Conn. All revolve around Conn’s recommendation of inappropriate, unsuitable securities. A suitability violation exists when a broker recommends an investment that is inconsistent with the needs of an investor or who puts the broker’s needs ahead of the investor’s.
He is also accused of making trades without a client’s authorization. This often results in an action referred to as “churning”. Churning is an action where a broker makes numerous, unauthorized trades to make money for himself.
Conn previously worked at Deutsche Bank from 2005-2012 and for JP Morgan from 2012-2018. He has served as a Raymond James broker from 2018 through August 2022. At that time, Raymond James terminated his employment. Regulatory documents file by Raymond James states, “Individual failed to follow firm policies with respect to exercise of discretion, and with respect to payments to a client, and for a potential unreported OBA.”
We have handled numerous case like this over the last 20 years and can help recover losses.
J.P. Morgan employed Edward Turley as its representative between 2009 and 2021. Approximately a dozen cases have been filed against Turley and J.P. Morgan for Turley’s inappropriate sales practices in the sale of securities. These allegations led J.P. Morgan and Turley to separate after the allegations.
The allegations of investors, and ultimately those of regulators, involved the sale of unsuitable securities. FINRA, the Financial Industry Regulatory Authority, have rules preventing such sales. Unsuitable securities sales include churning, unauthorized sales, sale of securities that put the brokers interests ahead of the investor, and securities inconsistent with an investor’s risk tolerance.
The allegations against Turley are primarily from the 2016-2021 time period. The investments included but were not limited to the use of foreign currency, margin investing, and the purchasing and selling of high-yield bonds and preferred stock. Claims against J.P. Morgan for the actions of Turley currently exceed $70 million.
Ultimately, Turley was barred from the securities industry for not cooperating with regulators investigating the claims against him.
The Law Offices of Jeffrey Pederson has successfully handled hundreds of suitability cases over the last 20 years. Call for a free and confidential consultation if Turley was your financial advisor.