OUR STOCKBROKER FRAUD CASES & INVESTIGATIONS

For over 40 years, Attorney Pearce and his staff members at The Law Offices of Robert Wayne Pearce, P.A. have worked on and continue to work on a wide variety of securities, commodities and investment disputes for investors arising out of stock brokerage, commodity brokerage, insurance and other financial service companys’ employees, representatives and agents’ misconduct. We represent investors with securities and commodities law issues and a broad range of other practice areas in courtroom litigation, arbitration and mediation proceedings from offices in Boca Raton, Florida across the United States.

Our Florida Attorneys Handle Stockbroker Fraud Cases & Investigations Nationwide

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The most common investor claims have been claims for misrepresentationfailure to disclose important informationunsuitable recommendationschurning or excessive trading, and unauthorized trading in stocksbondsmutual funds and options in violation of federal and state statutes, common law and industry rules. However, in the past three years, most of our cases have arisen out of the latest wave of investment products, widespread misconduct with the same investment firms, branch offices and/or brokers. We are presently engaged in a number of cases and investigations involving not only the so-called “garden variety” stock, bond and option claims but many other types of misrepresented and mismanaged investment products and fraudulent schemes.

A brief description of some of our current stockbroker fraud Cases and Investigations with links to other pages within our website and Investors Rights Blog to help answer your questions and help you recover your losses is below:

J.P. Morgan Sued for Edward Turley and Steven Foote’s Alleged Margin Account Misconduct

J.P. Morgan Securities, LLC (“J.P. Morgan”) employed San Francisco Financial Advisor Edward Turley (“Mr. Turley”) and his former New York City partner, Steven Foote (“Mr. Foote”), and is being sued for their alleged stockbroker fraud and stockbroker misconduct involving a highly speculative trading investment strategy in highly leveraged margin accounts1. We represent a family (the “Claimants”) in the Southwest who built a successful manufacturing business and entrusted their savings to J.P. Morgan and its two financial advisors to manage by investing in “solid companies” and in a “careful” manner. At the outset, it is important for our readers to know that our clients’ allegations have not yet been proven. We are providing information about our clients’ allegations and seeking information from other investors who did business with J.P. Morgan, Mr. Turley, and/or Mr. Foote and had similar investments, a similar investment strategy, and a similar bad experience to help us win our clients’ case.

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Securities-Backed Lines of Credit Can Ce More Dangerous Than Margin Accounts

Many investors have heard of margin accounts and the horror stories of others who invested on margin and suffered substantial losses. But few investors understand that securities-backed lines of credit (SBL) accounts, which have been aggressively promoted by brokerage firms in the last decade, are just as dangerous as margin accounts. This is largely due to the fact that the equity and bond markets have been on an upward trend since 2009 and few investors (unless you are a Puerto Rico investor) have experienced market slides resulting in margin calls due to the insufficient amount of collateral in the SBL accounts. Securities-Backed Lines of Credit Overview It is only over the last several months of market volatility that investors have begun to feel the wrath of margin calls and understand the high risks associated with investing in SBL accounts. For investors considering your stockbroker’s offer of a line of credit (a loan at a variable or fixed rate of interest) to finance a residence, a boat, or to pay taxes or for your child’s college education, you may want to read a little more about the nature, mechanics, and risks of SBL accounts before you sign the collateral account agreement and pledge away your life savings to the brokerage firm in exchange for the same loan you could have obtained from another bank without all the risk associated with SBL accounts. First, it may be helpful to understand just why SBL accounts have become so popular over the last decade. It should be no surprise that the primary reason for your stockbroker’s offering of an SBL is that both the brokerage firm and he/she make money. Over many years, the source of revenues for brokerage firms has shifted from transaction-based commissions to fee-based investments, limited partnerships, real estate investment trusts (REITs), structured products, managed accounts, and income earned from lending money to clients in SBL and margin accounts. Many more investors seem to be aware of the danger of borrowing in margin accounts for the purposes of buying and selling securities, so the brokerage firms expanded their banking activities with their banking affiliates to expand the market and their profitability in the lending arena through SBL accounts. The typical sales pitch is that SBL accounts are an easy and inexpensive way to access cash by borrowing against the assets in your investment portfolio without having to liquidate any securities you own so that you can continue to profit from your stockbroker’s supposedly successful and infallible investment strategy. Today the SBL lending business is perhaps one of the more profitable divisions at any brokerage firm and banking affiliate offering that product because the brokerage firm retains assets under management and the fees related thereto and the banking affiliate earns interest income from another market it did not otherwise have direct access to. For the benefit of the novice investor, let me explain the basics of just how an SBL account works. An SBL account allows you to borrow money using securities held in your investment accounts as collateral for the loan. The Danger of Investing in SBL Accounts Once the account is established and you received the loan proceeds, you can continue to buy and sell securities in that account, so long as the value of the securities in the account exceeds the minimum collateral requirements of the banking affiliate, which can change just like the margin requirements at a brokerage firm. Assuming you meet those collateral requirements, you only make monthly interest-only payments and the loan remains outstanding until it is repaid. You can pay down the loan balance at any time, and borrow again and pay it down, and borrow again, so long as the SBL account has sufficient collateral and you make the monthly interest-only payments in your SBL account. In fact, the monthly interest-only payments can be paid by borrowing additional money from the bank to satisfy them until you reach a credit limit or the collateral in your account becomes insufficient at your brokerage firm and its banking affiliate’s discretion. We have heard some stockbrokers describe SBLs as equivalent to home equity lines, but they are not really the same. Yes, they are similar in the sense that the amount of equity in your SBL account, like your equity in your house, is collateral for a loan, but you will not lose your house without notice or a lengthy foreclosure process. On the other hand, you can lose all of your securities in your SBL account if the market goes south and the brokerage firm along with its banking affiliate sell, without prior notice, all of the securities serving as collateral in the SBL account. You might ask how can that happen; that is, sell the securities in your SBL account, without notice? Well, when you open up an SBL account, the brokerage firm and its banking affiliate and you will execute a contract, a loan agreement that specifies the maximum amount the bank will agree to lend you in exchange for your agreement to pledge your investment account assets as collateral for the loan. You also agree in that contract that if the value of your securities declines to an amount that is no longer sufficient to secure your line of credit, you must agree to post additional collateral or repay the loan upon demand. Lines of credit are typically demand loans, meaning the banking affiliate can demand repayment in full at any time. Generally, you will receive a “maintenance call” from the brokerage firm and/or its banking affiliate notifying you that you must post additional collateral or repay the loan in 3 to 5 days or, if you are unable to do so, the brokerage firm will liquidate your securities and keep the cash necessary to satisfy the “maintenance call” or, in some cases, use the proceeds to pay off the entire loan. But I want to emphasize, the brokerage firm and its banking affiliate, under the terms of almost all SBL account agreements,...

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UBS Puerto Rico Misrepresents Safety of Bond Funds to Investor

The Law Offices of Robert Wayne Pearce, P.A. filed yet another claim against UBS Financial Services Incorporated of Puerto Rico (UBS Puerto Rico). A summary of the allegations the Claimant made against the Puerto Rico based brokerage is below. If you or any family member received similar misrepresentations and/or misleading statements from UBS Puerto Rico and its stockbrokers or found yourself with an account overconcentrated in closed-end bond funds, or if you borrowed monies from UBS Puerto Rico and used your investments as collateral for those loans, we may be able to help you recover your losses. Contact our office for a free consultation about your case.

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Investors With “Blown-Out” Securities-Backed Credit Line and Margin Accounts: How do You Recover Your Investment Losses?

If you are reading this article, we are guessing you had a bad experience recently in either a securities-backed line of credit (“SBL”) or margin account that suffered margin calls and was liquidated without notice, causing you to realize losses. Ordinarily, investors with margin calls receive 3 to 5 days to meet them; and if that happened, the value of the securities in your account might have increased within that period and the firm might have erased the margin call and might not have liquidated your account. If you are an investor who has experienced margin calls in the past, and that is your only complaint then, read no further because when you signed the account agreement with the brokerage firm you chose to do business with, you probably gave it the right to liquidate all of the securities in your account at any time without notice. On the other hand, if you are an investor with little experience or one with a modest financial condition who was talked into opening a securities-backed line of credit account without being advised of the true nature, mechanics, and/or risks of opening such an account, then you should call us now! Alternatively, if you are an investor who needed to withdraw money for a house or to pay for your taxes or child’s education but was talked into holding a risky or concentrated portfolio of stocks and/or junk bonds in a pledged collateral account for a credit-line or a margin account, then we can probably help you recover your investment losses as well. The key to a successful recovery of your investment loss is not to focus on the brokerage firm’s liquidation of the securities in your account without notice. Instead, the focus on your case should be on what you were told and whether the recommendation was suitable for you before you opened the account and suffered the liquidation.

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UBS Yield Enhanced Strategy Investors: How Do You Recover Your “UBS-YES” Investment Losses?

If you are reading this article, you probably invested in the UBS Yield Enhanced Strategy (“UBS-YES”) and were surprised to learn the UBS-YES program you invested in was not exactly a “market neutral” investment strategy during the recent COVID 19 market crash. Despite your UBS stockbroker’s representations about the UBS-YES managers ability to “manage risk” and “minimize losses” through its “iron condor” option strategy you still realized substantial losses. You are not alone because that is just what many other UBS-YES investors have told us about the pitch made to them to invest in the UBS-YES program and their recent experience.

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UBS Financial Services, Inc. Sued for Florida and Ohio Advisor’s Alleged Misconduct Involving a Credit-Line Investment Strategy

UBS Financial Services, Inc, (“UBS”) employed a financial advisor (the “FA”) who has offices in Bonita Springs, Florida and Sylvania, Ohio. UBS held out the FA and other UBS employees on his team as investment advisers, investment managers, financial advisers, and financial planners with special skills and expertise in the management of securities portfolios and financial, estate, retirement, and tax planning matters.

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A Review of The Securities and Commodities Investment Laws

Financial Fraud Has Probably Been Around Since The Dawn Of Commerce. It Has Always Been Perpetrated By Individuals Who Scheme To Take Possessions (Goods And Capital) From Another By Misrepresentations, Misleading Statements, Manipulation And Other Means Declared Over Time To Be Fraudulent Practices, Schemes, Contrivances, And Devices.

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Oil and Gas Investors: How Do You Recover Your Oil and Gas Investment Losses?

Oil and Gas Investors: How Do You Recover Your Oil and Gas Investment Losses? If you are reading this article, we are guessing you invested in one or more of those misrepresented and unsuitable oil and gas stocks, bonds, limited partnerships, commodities, commodity pools and/or structured products as alternative investments linked to the oil and gas sector of the stock and commodities markets. We would not be surprised if you were told that the large oil and gas conglomerates had a proven track record of great dividends much higher than the yields on the fixed income investments you were accustomed but said nothing about the volatility of those types of investments. Maybe you are reading this webpage because your financial advisor recommended you invest your retirement savings in some those more complex and leveraged oil and gas structured products packaged as Exchange Traded Funds (ETFs), Exchange Traded Notes (ETNs) or other Exchange Traded Products (ETPs), that were leveraged two to three times and crashed in March this year. These were not suitable investments for retirees with conservative or moderate investor risk profiles. Did your financial advisor recommend you invest without explaining the nature, mechanics or risks of any of those oil and gas investments? Were your investments over-concentrated (more than 10% of your portfolio) by your stockbroker or investment advisor in the oil and gas sector to replace the bonds you owned for the higher dividend paying stocks? Did you lose fifty percent (50%) or more on those oil and gas investments? We’re not shocked because that is just what many other investors have told us about what happened to them recently. Now we are going to tell you what to do about those oil and gas investment losses. Your stockbroker had a duty to not only understand but explain the nature, mechanics and all of the risks associated with those investments before he/she sold you those investments, particularly some of the provisions within the ETNs where the broker-dealer who issued the ETNs or ETPs could redeem or retire them and force you to realize huge losses. Your stockbroker also had a duty to make sure they were suitable investments before they were recommended in light of your risk tolerance and financial condition and not over-concentrate investments in the volatile oil and gas sector in your portfolio. Unfortunately, many financial advisors who did not understand the nature, mechanics or risks sold these investments to clients with conservative and moderate risk who were seeking to enhance their income for their retirement. These were not suitable investments for investors with that kind of profile. If your financial advisor misrepresented the nature, mechanics or risks of those oil and gas investments or the risks were not fully explained, or you were over-concentrated (more than 10%) in the oil and gas sector, or if it was not in your best interest (or unsuitable), and/or your investments were liquidated without notice due to margin calls, you may have the right to bring an arbitration claim against your financial advisor and/or the brokerage firm who employed him. There is no way you will recover your losses on these oil and gas investments without some legal action. At The Law Offices of Robert Wayne Pearce, P.A., we represent investors in investment disputes for misrepresented and unsuitable investments in oil and gas stocks, bonds, limited partnerships, commodities, commodity pools and/or structured products as alternative investments linked to the oil and gas sector of the stock and commodities markets in FINRA arbitration and mediation proceedings. The claims we file are for fraud and misrepresentation, breach of fiduciary duty, failure to supervise, and unsuitable recommendations in violation of SEC and FINRA rules and industry standards. Attorney Pearce and his staff represent investors across the United States on a CONTINGENCY FEE basis which means you pay nothing – NO FEES-NO COSTS – unless we put money in your pocket after receiving a settlement or FINRA arbitration award. Se habla español CONTACT US FOR A FREE INITIAL CONSULTATION WITH EXPERIENCED STRUCTURED PRODUCT INVESTMENT ATTORNEYS IN FINRA ARBITRATIONS The Law Offices of Robert Wayne Pearce, P.A. have highly experienced lawyers who have successfully handled many oil and gas investment cases and other securities law matters and investment disputes in FINRA arbitration proceedings, and who work tirelessly to secure the best possible result for you and your case. For dedicated representation by an attorney with over 40 years of experience and success in structured product cases and all kinds of securities law and investment disputes, contact the firm by phone at 561-338-0037, toll free at 800-732-2889 or via e-mail.

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FINRA Arbitration: What To Expect And Why You Should Choose Our Law Firm

If you are reading this article, you are probably an investor who has lost a substantial amount of money, Googled “FINRA Arbitration Lawyer,” clicked on a number of attorney websites, and maybe even spoken with a so-called “Securities Arbitration Lawyer” who told you after a five minute telephone call that “you have a great case;” “you need to sign a retainer agreement on a ‘contingency fee’ basis;” and “you need to act now because the statute of limitations is going to run.”

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