Investment Fraud Lawyer Blog

On July 30, 2010, Judge Michael D. Johnson of the Superior Court of Fulton County, Georgia, confirmed and upheld a December 2009 award issued by an Atlanta-based Financial Industry Regulatory Authority (FINRA) arbitration panel ordering SunTrust Robinson Humphrey, Inc. (SunTrust) to pay over $4.1 million in damages (including punitive damages, attorneys’ fees and costs) to a former registered representative based on a claim of wrongful termination and malicious defamation in annotating the claimant’s Form U-5 (a regulatory filing) to indicate that he had been “permitted to resign” for “failure to follow firm sales practice policy.”

After the award was issued, SunTrust filed a motion to vacate (i.e., throw out) the award, which Judge Johnson denied at the same time that he confirmed the award.

Continue reading "Georgia Court Upholds $4.1 Million Damage Award Against SunTrust Robinson Humphrey for Terminating and Defaming a Broker who Sold Auction Rate Securities" »

White House executive “pay czar” Kenneth Feinberg has decided not to negotiate with 17 Wall Street firms to rescind $1.6 billion in payments to executive that Feinberg himself described as “ill advised” and payments that “[t]hey should not have made,” according to articles in the Atlanta Journal Constitution (“Bank execs get to l]keep $1.6 billion” by Daniel Wagner) and CNNMoney (“Banks paid big $ to execs during crisis” by David Ellis).

Continue reading "Wall Street Executives Get $1.6 Billion, Main Street America Picks Up the Tab" »

The Financial Industry Regulatory Authority (FINRA) has ordered SunTrust Investment Services, Inc. of Atlanta, GA (“SunTrust”), to pay $1.44 million in fines and restitution for misconduct arising out of unsuitable recommendations and churning the accounts of 17 mostly elderly customers, according to an article by J. Scott Tinsley in the Atlanta Journal Constitution (“SunTrust unit fined for improper trades”). $900,000 of that amount is a fine, which includes nearly $224,000 in disgorgement of commissions flowing from the unsuitable trades. The remaining $540,000 will serve as restitution to the customers who incurred losses.

Continue reading "SunTrust Burns Elderly Victims" »

Brokerage firms’ advertising portrays brokers as trusted members of the family, writes Tara Siegel Bernard in her New York Times article, “Trusted Adviser or Stock Pusher? Finance Bill May Not Settle It.” Anyone who has tried to hold a broker to a fiduciary standard of conduct, however, hears a very different response: “We are mere order takers. You never should have trusted us.”

Continue reading "Is Your Financial Adviser Acting in Your Best Interest?" »

According to a recent Bloomberg National Poll, more than 50% of Americans despise Wall Street and favor punishment of the bankers who caused the worst financial crisis since the Great Depression. The majority of poll participants -- 56 percent -- say big financial companies are more interested in enriching themselves at the expense of ordinary people.

Continue reading "It's Official - Most Americans Despise Wall Street" »

There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:

• The Dow Jones Industrial Average opened the year at 10,428 and, on Monday, the market soared 156 points.

• On Tuesday, the Dow Jones Industrial Average dropped 12 points.

• On Wednesday, the Dow Jones Industrial Average gained 2 points.

• On Thursday, the Dow Jones Industrial Average rose 33 points.

• On Friday, the Dow Jones Industrial Average moved up 11 more points and closed the week at 10,618.

Continue reading "Page Perry's Market Monitor - January 8, 2010" »

An Atlanta-based Financial Industry Regulatory Authority (FINRA) arbitration panel has ordered SunTrust Robinson Humphrey, Inc. (SunTrust) to pay over $4.1 million in damages (including punitive damages, attorneys’ fees and costs) to a former registered representative based on a claim of wrongful termination and malicious defamation in annotating the claimant’s Form U-5 (a regulatory filing) to indicate that he had been “permitted to resign” for “failure to follow firm sales practice policy.” The claim arose out of the sale of Trapeza V, LLC Auction Rate Preferred Securities. The claimant was a 19-year veteran of SunTrust. The case is Lance R. Beck v. SunTrust Robinson Humphrey, Inc., FINRA Case No. 08-02482.

Continue reading "SunTrust Hit with $4.1 Million Damage Award for Terminating and Defaming a Broker who Sold Auction Rate Securities " »

The Wall Street Journal reports that “hundreds of businesses are fighting to recover billions of dollars tied up in frozen auction-rates securities, a year after Wall Street firms agreed to $60 billion in settlements over the collapsed market for the investments.” See “Firms Fight Banks Over Billions in Frozen Notes,” WSJ 1/2/10. While regulators stepped in to help individual investors after the auctions froze in February 2008, many corporate and institutional investors did not benefit from settlements between banks, broker-dealers and the SEC, FINRA and state attorneys general. According to Atlanta attorney Craig T. Jones, investors were left holding about $330 billion in illiquid securities when the auctions froze, so $60 billion in settlements is only a drop in the bucket.”

Continue reading "The Auction Rate Securities Debacle Continues - Corporate America Takes on Wall Street" »

There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:

• The Dow Jones Industrial Average opened the week at 9996 and, on Monday, the market rose 96 points.

• On Tuesday, the Dow Jones Industrial Average fell 51 points.

• On Wednesday, the Dow Jones Industrial Average dropped 92 points.

• On Thursday, the Dow Jones Industrial Average moved up 132 points.

• On Friday, the Dow Jones Industrial Average sunk 109 points and closed the week at 9972.

Continue reading "Page Perry's Market Monitor - October 23, 2009" »

A federal judge in Atlanta recently dismissed a class action lawsuit brought against SunTrust for fraud in the sale of auction rate securities. The case was not dismissed on the merits of investors’ claims against SunTrust, but based on technical legal requirements about what it takes to plead a claim. Those requirements are strict in securities fraud cases that get filed in federal court, especially class actions, but they do not apply to cases that get filed in arbitration.

Continue reading "Arbitration or Class Action - Which is Better for Investors?" »

The Securities Industry and Financial Markets Association, an important Wall Street lobbying group, has decided to support the Obama administration’s proposal to hold brokers to the same standard as a fiduciary when they provide investment advice, according to a recent report in The Wall Street Journal. While investors who sue their brokers have long argued, with considerable success, that a fiduciary duty arises whenever there is a relationship of trust and confidence between broker and investor, that determination is presently made on a case by case basis under laws that vary from state to state. A federal standard, which is more likely to pass now that it has been endorsed by the industry, would make it easier for investors to prevail in claims against brokers.

Continue reading "Wall Street Trade Association Supports Fiduciary Standard" »

Seven months after the Atlanta Journal and Constitution (AJC) reported that SunTrust Bank was negotiating with regulators to buy back $500 million in auction rate securities from SunTrust customers, the bank has decided not to pay back all of its customers. According to a statement released by the Financial Industry Regulatory Authority (FINRA) in May 2009, four (4) other investment firms agreed to repurchase $554 million worth of auction rate securities from investors who were misled about the liquidity of their investments, but SunTrust Investment Services, Inc. and SunTrust Robinson Humphrey, Inc. – both of which are subsidiaries of SunTrust Bank based in Atlanta – withdrew a previous offer to settle with FINRA.

Continue reading "SunTrust Backs Out Of Deal To Pay Back Investor Losses" »

On May 13, 2009, the U.S. Securities and Exchange Commission (“SEC”) approved a rule change that requires brokers to disclose alleged sales practice violations made by a customer against a securities broker in the body of a civil lawsuit or arbitration claim, even if that broker is not named as a defendant or respondent. The SEC received a total of 1,654 comment letters on the proposed rule change. Approximately 1,451 of the letters were “form letters” from financial advisors and insurance agents (who sell insurance products such as variable annuities) opposing the change.

Continue reading "Regulators Require Financial Firms to Provide More Public Disclosure Regarding Customer Complaints" »

There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:

• The Dow Jones Industrial Average opened the week at 8076 and, on Monday, plunged 51 points.

• On Tuesday, the Dow Jones Industrial Average bounced back 128 points.

• On Wednesday, the Dow Jones Industrial Average jumped 169 points.

• On Thursday, the Dow Jones Industrial Average lost 18 points.

• On Friday, the Dow Jones Industrial Average rose 44 points and closed the week at 8212.

Continue reading "Page Perry's Market Monitor - May 1, 2009" »

Washington is doing far too little to strengthen the government’s ability to investigate and prosecute the type of corporate and mortgage fraud that led to the economic collapse, The New York Times opined in an Editorial dated April 18, 2009. The Times points out that focus has shifted away from financial fraud to anti-terrorist activities, and that this has resulted in fewer fraud investigators to police the huge infusion of federal money into the economy.

Continue reading "Corporate Fraud Needs to be a Government Priority " »

Investors who still hold auction-rate securities are facing many increasing problems, according to an article in today’s Bloomberg.com by Michael McDonald. Last February, the $330 billion market for auction-rate securities essentially froze when major Wall Street firms discontinued supporting auction-rate securities. A year later, investors are still stuck with as much as $176 billion of auction-rate securities that pay an average of 1.36%. Thus, it is apparent that many investors have been left out in the cold even after regulators forced some firms to buy back more than $50 million of auction-rate securities. Investors are stuck is because the market remains frozen and issuers either have no incentive to refinance or are unable to refinance. Many investors rightly complain that a large portion their liquid wealth is frozen and paying next to nothing in interest, and, while they may be able to liquidate their holdings in the secondary market, they can do so only if they accept less than what they paid for the auction rate securities.

Continue reading "Things Continue to Get Worse for Auction-Rate Securities Investors" »

Time may be running out on certain auction-rate securities claims. Some investors may need to act promptly if they wish to protect their rights. The laws of each state establish time limits (statutes of limitations) within which legal claims must be asserted. Those time limits vary from state to state. Claims not brought within the applicable statute of limitations may be disallowed. To be conservative, investors should assume the clock starts ticking on the date of the transaction in question (although discovery and tolling rules that delay the running of the clock may apply).

Continue reading "Tick-Tock: Spurned Auction-Rate Securities Investors Need to Monitor the Clock" »

There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:

• On Monday, the Dow Jones Industrial Average fell 32 points.

• On Tuesday, the Dow Jones Industrial Average advanced 184 points.

• On Wednesday, the Dow Jones Industrial Average rose 108 points and closed the year at 8776.39.

• On Thursday, the market was closed.

• On Friday, the Dow Jones Industrial Average rose 258 points and closed the week at 9035.

Continue reading "Page Perry's Market Monitor - January 2, 2009" »

There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:

• On Monday, the Dow Jones Industrial Average dropped by 73 points.

• On Tuesday, the Dow Jones Industrial Average fell by 176 points.

• On Wednesday, the Dow Jones Industrial Average plunged 411 points.

• On Thursday, the Dow Jones Industrial Average surged 553 points.

• On Friday, the Dow Jones Industrial Average dropped 338 points and closed the week at 8497.

Continue reading "Page Perry's Market Monitor - November 14 , 2008" »

Yesterday the Financial Industry Regulatory Authority (“FINRA”) announced auction-rate securities settlements with SunTrust Robinson Humphrey, Comerica Securities, First Southwest, and WaMu Investments, Inc.

Continue reading "FINRA Announces Auction-Rate Securities Settlements with More Firms" »