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Securities Fraud Blog

Greco & Greco, P.C.

W. Scott Greco

Fight Investment Fraud

Greco & Greco's lawyers represent investors to recover losses caused by securities fraud, churning, lack of suitability, negligence, sales of unregistered securities, unauthorized trading, and other misconduct by stock brokers, investment advisors, financial planners and their firms.

For a Free Attorney Consultation, call us at 877-821-5550 orĀ 

FINRA Implements All Public Arbitration Panels

Earlier this year, FINRA (the Financial Industry Regulatory Authority) implemented a change to its arbitration system which has been sought by the Claimants’ bar for years.  As set out in this notice, customer Claimants in FINRA arbitrations now have the choice to have their disputes with their stock brokers and brokerage firms heard by three public arbitrators for cases over $100,000.00. 

Under the previous FINRA Rule, three arbitrator panels were required to include one “non-public” or “industry” arbitrator, i.e. someone currently employed in the securities industry or with present or former ties to the industry.  The securities industry requires that customers arbitrate their disputes with their brokerage firms through FINRA, and virtually all new account forms from U.S. brokerage firms contain a mandatory arbitration clause.  Greco & Greco regularly represents customers in FINRA arbitrations - if you would like to discuss a potential claim with one of our attorneys, please Contact Us.

Posted by W. Scott Greco on 06/24/11.
ArbitrationBrokerage FirmsFINRAPermalink

SEC Fraud Charges Regarding The Nutmeg Group LLC

As set out in the SEC Complaint which can be found here, the SEC filed civil fraud claims in Illinois against The Nutmeg Group, LLC, Randall Goulding, and others.  The SEC alleges in its Complaint that Nutmeg was an investment adviser to 15 funds which invested fund assets in private investments in public equity (PIPE) transactions.  As a basis for its fraud claims, the SEC alleges in the Complaint that Nutmeg “improperly commingled investor and fund assets,” “misappropriated over $4 million in fund assets,” “failed to maintain the required books and records,” and “overstated the performances of its Funds to investors.”  (paragraphs 2 and 3 of SEC Complaint). 

All FINRA registered representatives are required to be registered with a FINRA firm (Broker-Dealer).  FINRA firms have legal responsibilities to supervise their registered representatives, and further may be found liable for the wrongful actions of their agents.  Examples of legal grounds for liability of Broker-Dealers in these situations include:

a) under tort and agency law, principals can be found liable for the acts of their agents even if they are entirely innocent and have received no benefit from the transaction;

b) a broker?s Broker-Dealer can also be found liable as a ?control person? of that broker under state and federal securities laws; and

c) claims can be pursued in arbitration based on violations of FINRA rules including Rules related to supervision, suitability, and outside business activities.

If you were sold investments in Nutmeg Group funds by a FINRA registered representative, and you would like to discuss legal options with an attorney, please contact Greco & Greco for a free consultation with one of our lawyers.

Posted by W. Scott Greco on 06/08/11.
ArbitrationBrokerage FirmsPonzi SchemePrivate PlacementsSECState RegulatorsColoradoFloridaSuitabilityUnregistered SecuritiesPermalink

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