Securities Fraud Guilty Plea for IPOF Fund Manager
A fund manager who had utilized Ferris Baker Watts accounts for his IPOF fund plead guilty in Cleveland, Ohio to securities fraud related to stock price manipulation. According to this Baltimore Sun article, David A. Dadante lost $28 million dollars of investors’ monies in a scheme that started as a ponzi scheme and led to at least four different illegal trading techniques to artificially increase the price of a specific stock, Innotrac.
The Baltimore Sun has extensively covered the involvement of Ferris Baker Watts in this matter in these linked articles, which discuss the early retirement of several executives since the investigation began, a 2003 company memo regarding concerns, and internal flags of potential problems in Dadante’s accounts.
Stephen J. Glantz, a former Ferris broker, has recently been charged with related securities fraud by federal prosecutors in Cleveland. According to this Baltimore Sun article, the Ferris broker is charged with engaging in unauthorized trading in his clients’ account to aid Dadante’s scheme.
Posted by Greco & Greco on 08/17 at 12:03 PM
Brokerage Firms •
Ferris Baker Watts •
Ponzi Scheme •
Stock Manipulation •
Unauthorized Trading •
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Suitability of Hedge Funds
Hedge funds are largely unregulated investment funds which are typically limited to investment by accredited investors, i.e. high net worth individuals, pension funds, and other institutional investors. These funds are not restricted by many of the regulations and disclosure requirements of mutual funds, and they have evolved into a widely diverse industry investing in an array of traditional and non-traditional investments.
As set out in the NASD Notice to its Members linked below, the NASD / FINRA has expressed its concern regarding the sale of hedge funds by its representatives to retail customers. The Notice emphasizes that the risks and disadvantages associated with hedge funds must be fully disclosed to retail customers, and the sales representative or member must use due diligence to investigate the fund and must make a customer specific determination of suitability for the customer’s situation.
NASD Notice to Members
Posted by Greco & Greco on 08/16 at 01:47 PM
Hedge Funds •
NASD Regulation •
Suitability •
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Morgan Stanley fined for corporate bond overcharges
As set out in this FINRA press release Morgan Stanley was fined and forced to pay restitution to retail customers for overcharging for corporate bond sales and for “having an inadequate supervisory system for monitoring the pricing of corporate fixed income securities sold to customers.”
Posted by Greco & Greco on 08/03 at 04:30 PM
Bonds •
Brokerage Firms •
Morgan Stanley •
FINRA •
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Universal Leases found to be Unregistered Securities
As set out more fully below on our firm’s website (link below), the sale of Universal Leases in the name of Resort Holdings, Yucatan Resorts, and Avalon Resorts have been found by many states to be violations of securities laws prohibiting the sale of unregistered securities. The federal government has alleged that these investments relating to timeshares were a ponzi scheme. The link below further has a link to the FBI press release regarding the arrest of Michael Kelly.
Greco & Greco Universal Lease page
Posted by Greco & Greco on 08/03 at 04:13 PM
Ponzi Scheme •
State Regulators •
Arizona •
California •
Colorado •
Illinois •
Maryland •
Pennsylvania •
Texas •
Utah •
Universal Lease - Resort Holdings, Yucatan, Avalon •
Unregistered Securities •
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