Articles Posted in Disciplinary Actions

Neil Pecker, a registered representative from Longwood, Florida, formerly with Vision Financial Partners, Coastal Equities and Westpark Capital was barred from FINRA membership as a result of refusing to cooperate with a FINRA investigation.  Previously, Pecker had been charged by the CFTC with making false and materially misleading statements to clients in connection with an options trading strategy.  Pecker consented to the entry of an order and an injunction and agreed to pay restitution of $2.7 million and a $3.75 million penalty.

FINRA Rule 9552. Failure to Provide Information or Keep Information Current

This FINRA rule provides if a FINRA member fails to provide information or testimony requested or required by FINRA’s By-Laws or FINRA rules, or fails to keep his or her membership and supporting documents current, FINRA, after providing  21 days’ notice may suspend the FINRA membership of the person.

Thomas Andrews, a registered representative from California, formerly from Nephi, Utah, and previously registered with LPL Financial was barred from FINRA as a result of allegations he defrauded over twenty clients in a scam he called “the Lincoln” and “the Jackson Trust.”  Accroding to a complaint filed by the SEC, Andrews with the help of his personal assistant Scott Christensen allegedly told investors that these investments were guaranteed and would pay them between five and eight percent.  In fact, according to the SEC, the investment companies were fake and Andrews use the funds to support his lifestyle and pay Christensen over $1,000,000 to help him by mailing out bogus account statements.  When LPL discovered that Andrews had misappropriated client funds in 2015, the terminated him.  In 2016 he plead guilty to felony securities fraud and mail fraud.

Thomas Andrews’s registration and disciplinary history

In order to lawfully sell investments to the public, one must either be registered or exempt from registration.

Abida Khan, aka Sheik Firdosh Kahn a registered representative from Pasadena, California, formerly with Ameritas Investment Corporation and Pruco Securities was barred from FINRA membership as a result of SEC proceedings into her role in brokering transactions in VGTL.  According to the SEC, Khan received bribes from the seller of VGTL shares in order to persuade her clients to participate in the transactions.  On March 22, 2017 a jury found Khan guilty of engaging in manipulative and deceptive conduct pertaining to the VGTL transactions. As a result, Khan was barred from the securities industry.

Abida Khan’s registration and disciplinary history

In order to lawfully sell investments to the public, one must either be registered or exempt from registration.

FINRA barred Nick Shermeta over his role in penny stock transactions.  Criminal charges for aiding and abetting wire fraud are pending as of March, 2017.

Nick Shermeta, a registered representative from Minnetonka, Minnesota,  formerly with Northland Securities and Feltl & Company was barred from FINRA membership as a result of SEC proceedings into his role in brokering transactions in Dakota Plains, a company raising money via a private placement of securities.  Shermeta engaged in outside business activities aka “selling away”, and arranged for Dakota Plains to pay him commissions for the transactions through a company set up by Shermeta.

According to the SEC, Shermeta acted as an unregistered broker dealer in 2011 by soliciting investors to purchase shares of Dakota Plains.  Some of Shermeta’s clients were also clients of his broker dealer at the time.

In February, 2017 the Certified Financial Planner Board’s Commission of Discipline and Ethics disciplined Triad Advisors’ CFP Douglas Miller by issuing an interim suspension.  While under the interim suspension, Miller is prohibited from using the CFP certification pending a complete investigation by the CFP Board.

Miller, of Toledo, Ohio was previously registered with Triad Advisors, Walnut Street Securities and Royal Alliance.

The suspension arises from a FINRA enforcement action in which Miller entered into a letter of acceptance, waiver and consent (“AWC”) with FINRA that called for a permanent bar from membership.  As a result, Miller is not permitted to act as a registered representative or affiliate himself with any FINRA member firm for the purpose of selling securities.  FINRA’s disciplinary action concerned Miller’s sale of limited liability companies’ securities to clients via private securities transactions, a violation of Triad Advisor’s rules as well as FINRA’s rules.  Such outside business activities are a violation of FINRA rules if done without prior permission from a member firm.  Miller was “permitted to resign” from Triad Advisors with allegations of private securities transactions pending, as noted on his Form U-5

In February, 2017 the Certified Financial Planner Board’s Commission of Discipline and Ethics disciplined certified financial planner Sheldon Harber by suspending his CFP certification for a period of five months; from February 2017 through July, 2017.

Harber, of St. Louis, Missouri, Arkansas was previously registered with Geneos Wealth Management, Cambridge Investment Research and FSC Securities.

The suspension arises from a FINRA enforcement action in which Harber entered into a letter of acceptance, waiver and consent (“AWC”) with FINRA that called for a four month suspension and a $10,000 fine.  While suspended from FINRA Harber is not permitted to act as a registered representative or affiliate himself with any FINRA firm for the purpose of selling securities.

On May 15, 2017 the Corporation Commissioner for the state of Arizona, acting through the Securities Division filed a complaint seeking a cease and desist order, and the revocation of securities licensing against Michael Crowe, a registered representative formerly registered with Securities America and FSC Securities Corporation. The Corporation Commissioner is seeking the revocation of Crowe’s license as a result of his participation in an unapproved securities transaction made while Crowe was registered with Securities America.

The Securities Divisions’ complaint stems from an investigation into Crowe’s role in a securities transaction made with Simply Smart Homes, a company run by Richard Smart.  Smart purported to have an expertise in buying, fixing up, then “flipping” homes, and was looking for investors to fund his operations.  Smart and his company was previously the subject of a separate action brought by the Commissioner.

According to the complaint Crowe introduced a client to Smart, who was touting eight to ten percent returns for an investment in his company.  Crowe was paid $2,500 as a finder’s fee/commission for these services.  Several months later, in August, 2016, Crowe’s employer, Securities America discovered the transaction and terminated Crowe for engaging in private securities transactions without obtaining prior approval from the firm.

Alpine Securities Corporation charged by SEC.

On June, 5, 2017 the SEC charged Alpine Securities Corporation, a Utah based broker dealer with violations of the United States securities laws, specifically section 17(a) of the Securities Exchange Act of 1934.

The SEC’s complaint arises from a series of microcap stock transactions that the SEC alleges were used in a manipulative pump and dump scheme.

The SEC won its summary judgment motion  (SEC v Aschere ) against Aschere Energy on its claim that Aschere sold unregistered securities to the public.  Investors who purchased Aschere securities, especially in the “Wied Field” program should review their legal rights immediately.

On July 8, 2016 a federal judge in the Northern District of Texas affirmed his original Order (issued in March, 2016 ) on the SEC’s motion for summary judgment against Aschere Energy, Arcturus Corp, promoter Leon Ali Parvizian and brokers Robert J. Balunas and Alfredo Gonzalez.  The SEC had charged Aschere and the individuals with running an unregistered cold calling boiler room to sell shares of unregistered securities to the public.

In his ruling, Jude Kinkeade made findings that the Defendants acted as unregistered brokers when they sold unregistered securities in the Aschere Energy oil and gas programs.  The Judge also found that Parvizian had committed securities fraud by failing to disclose the lack of ownership in a program that Aschere was selling to the public

In January, 2017 FINRA barred former broker, Allstate Financial’s Michael Farinella

Michael Farinella, a registered representative from Florrisant, Missouri, formerly with AllState Financial Services was suspended from FINRA membership for violations of Rule 9552

FINRA Rule 9552. Failure to Provide Information or Keep Information Current