Investment fraud is a white-collar crime that occurs when someone misleads or deceives an investor for financial gain. This guide explains common schemes—Ponzi and pyramid tactics, promissory note fraud, crypto scams, real estate traps, and social media pitches—plus warning signs, investor rights, and practical steps to protect your portfolio and pursue recovery through legal claims.
Continue ReadingOur structured products lawyers help investors pursue recovery after losses from structured notes and complex derivatives. Many disputes involve misrepresentation of risks, missing disclosures, unsuitable recommendations, or dangerous overconcentration. We evaluate term sheets, prospectuses, and account records, then pursue claims through FINRA arbitration or mediation for fraud, breach of fiduciary duty, and failure to supervise.
Continue ReadingStructured notes are complex investments issued by financial institutions as unsecured obligations whose payout is tied to an underlying asset like an index, ETF, or stock. Returns depend on the note’s features and the asset’s performance, and liquidity before maturity may be limited. Investors should review the term sheet and risks before buying any one.
Continue ReadingDaily Business Review Monday, December 9, 2013 ARBITRATION AWARD AGAINST WELLS FARGO RECOVERS MOST OF FAMILY’S LOSSES Mediation and arbitration are supposed to be faster and more cost-effective than going to court. However, it was neither in a case involving the theft of millions of dollars from College Health and Investment L.P., a family-run limited partnership. The case took more than three years to resolve as attorneys for Wachovia Securities, now part of Wells Fargo, used numerous delaying tactics before ultimately paying a $2.75 million arbitration award, said Boca Raton securities attorney Robert W. Pearce, who represented College Health. The case grew out of Wells Fargo’s failure to detect the alleged theft and unauthorized transactions of millions of dollars by Esther Spero, whose aunt, Shari Jakobowitz, was in charge of the partnership’s accounts. Spero was accused of misusing the family’s financial information to steal about $7 million, which she in turn lost to one-time Miami Beach developer Michael Stern, who was supposed to be investing in real estate. Instead, Stern allegedly used the money to pay off his own debts after the real estate crash while funding a lavish lifestyle. Pearce traced most of the money and made recoveries in state court against Stern, a title company, Spero and Wachovia. “They came up a bit short, but we came close to getting most of their money back,” Pearce said. Then, in July, a Financial Industry Regulatory Authority arbitration panel ordered Wells Fargo to pay $2.75 million in damages and interest for failing to detect Spero’s alleged embezzlement. Pearce alleged bank employees went so far as to create a false power of attorney to give Spero control over the account that held most of the assets. Had the bank enforced its own policies and procedures, as well as FINRA’s rules, it would have detected the embezzlement, Pearce argued. “The bank had numerous red flags. It should have made inquiries to stop the movement of funds,” Pearce said.
Continue ReadingBy Dow Jones Business News, July 09, 2013, 04:07:00 PM EDT By Corrie Driebusch NEW YORK–An arbitration panel has ordered Wells Fargo Advisors to pay $2.8 million to a family limited partnership that accused the firm of negligence in connection with alleged thefts from its investment account. The Miami , Fla.-based partnership had sued a former secretary, accusing her of forging signatures to transfer money out of its accounts, and won a $21 million judgment in a Florida district court in 2010. That suit alleged the secretary, Esther Spero, took the money for her personal use from accounts at Wachovia Securities and elsewhere between 2005 and 2008. Wachovia was later acquired by Wells Fargo & Co. (WFC ). In its separate arbitration claim against Wells Fargo, the partnership, called College Health and Investment Ltd., said the brokerage was negligent in failing to detect the alleged theft. The Financial Industry Regulatory Authority arbitration panel found Wells Fargo to be liable and ordered that it pay $ 2.3 million in damages and prejudgment interest. Wells Fargo also must also pay $419,000 in margin interest and $35,000 in costs. College Health and Investment Ltd. had requested $4.4 million, according to the arbitration panel ruling. As is customary in the FINRA claims system, the written award did not explain the panel’s reasoning. Robert Wayne Pearce, lawyer for the partnership, said it showed the panel agreed with the negligence claim. A Wells Fargo spokesman said in a statement, “We’re disappointed in the panel’s decision and don’t believe it was warranted by the facts presented during the hearing.” Write to Corrie Driebusch at corrie.driebusch@dowjones.com. Dow Jones Newswires 07-09-131607ET Copyright (c) 2013 Dow Jones & Company, Inc.
Continue Reading