Investment Fraud Lawyer Blog

Even in today’s turbulent economy, many people dream of retiring early and living off of their investments. On occasion, unscrupulous investment advisers have been known to take advantage of this wish by promoting deceptive early retirement schemes. This problem has become a big enough problem that the SEC and FINRA have started warning investors to beware.

Continue reading "Securities Regulators Warn Investors about Early Retirement Scams" »

Many investors have reason to support the Occupy Wall Street movement that objects to Wall Street greed. These investors have seen their hard-earned money dissipate in the hands of their “trusted financial professionals.”

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Wells Fargo & Co. has agreed to pay $125 million to a group of pension funds to settle a class action filed by various public pension funds that purchased billions of dollars of mortgage-backed securities believing their money was in AAA-backed investments, according to a Wall Street Journal article by David Benoit entitled “Wells Fargo Settles Pension-Fund Mortgage Suit.” The proposed settlement is subject to court approval.

Continue reading "Wells Fargo Settles Mortgage-Backed Securities Claims filed by Pension Funds" »

Defense-minded institutions that have long remained on the sidelines when defrauded have finally woken up and are jumping on the plaintiff-recovery bandwagon as they seek to protect themselves against a variety of wrongdoing, according to Vanessa O’Connell’s Wall Street Journal article entitled “Company Lawyers Sniff Out Revenue.” These actions include waves of claims against Wall Street financial institutions for fraud in the sale of mortgage backed securities, CDOs and related exotic investments.

Continue reading "Institutional Investors Are Filing Big Claims Against Financial Services Firms" »

Bank of New York Mellon Corp. admits it did not act in its clients’ best interest in pricing foreign currency trades but says its clients are to blame because they knew or should have known what was going on, according to a Wall Street Journal article by Carrick Mollencamp and Tom McGinty entitled “Inside a Battle Over Forex.”

Continue reading "The Forex Mess Gets Nasty" »

As the elder population increases, various forms of elder abuse are on the rise. This includes investment fraud and outright theft. Scam artists especially target senior citizens who have seen their investment portfolios decline in value.

Continue reading "Many "Senior Specialists" Are Anything But !!!" »

A lawsuit recently filed against JPMorgan Chase paints a picture of how JPMorgan “profited in its deals with the weak,” according to a New York Times article by Louise Story called “JPMorgan Accused of Breaking Its Duty to Clients.” In this case, the “weak” are pension funds that lost nearly $500 million that was invested on their behalf by JPMorgan in notes issued by a troubled Structured Investment Vehicle (SIV) called Sigma.

Continue reading "Pension Funds Seek $500 Million from JP Morgan Chase for Breach of Legal Duties" »

InvestmentNews.com is reporting that the sixth-largest U.S. bank, Morgan Stanley, is being sued by employees of its own company. The plaintiffs claim “their stock-option and retirement saving plans sustained losses in 2008 because the company invested too heavily in its own shares.” In a complaint filed in Manhattan federal court, G. Kenneth Coulter and five other participants in the plan say that its directors “breached their fiduciary duty by failing to manage the plans’ assets and by not providing accurate information.”

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A suit filed in federal court in Atlanta by a former SunTrust Bank employee and 401(k) plan participant alleges that SunTrust violated federal retirement plan laws by selecting its own high-fee, poorly performing mutual funds for its 401(k) plan. See J. Scott Trubey’s article in the Atlanta Journal Constitution entitled “SunTrust faces suit over operation of 401(k).” The violations enriched SunTrust but cost plan participants more than $100 million dollars, according to the complaint.

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According to the “Financial Times”, public pensions are facing a $2,500 billion deficit due to chronic underfunding of retirement obligations and the severe US economic recession. As far back as 2008, the Pew Center on the States estimated a funding gap of at least $1,000 billion for pension, healthcare and other non-pension benefits like Medicaid. The most likely ways to bridge this money gap are through a sale of assets, issuing bonds, and legislative intervention. All of these possibilities have a downside.

Continue reading "Underfunded Public Pensions Spell Trouble" »

All is not well in the Land of Lincoln. The state’s governor’s office confirmed this week that the Securities and Exchange Commission (SEC) has launched an inquiry into public statements by Illinois officials concerning the state’s underfunded pension fund.

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Are crooks managing your pension? The Securities and Exchange Commission has unanimously passed a new rule banning so-called “pay to play” in the $2.6 trillion business of managing public pension funds. See “S.E.C. Tightens Rules on Public Pension Funds” by Edward Wyatt (New York Times) and “SEC Bans ‘Pay to Play’ for Advisers” by Fawn Johnson (Wall Street Journal).

Continue reading "The SEC Bans "Pay to Play" Abuses Associated with the Management of Public Pension Funds" »

The Wall Street Journal reported on October 20th that California Attorney General Jerry Brown has sued State Street Bank and Trust. Brown is seeking to recover $200 million in illegal overcharges and penalties that the bank misappropriated from two state agencies, the California Public Employees’ Retirement System and the California State Teachers’ Retirement System.

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Target-Date mutual funds are not always what they appear to be, reports Leslie Wayne in her June 25, 2009 article in the New York Times entitled “Target-Date Mutual Funds May Miss Their Mark.” Target-Date mutual funds are supposed increase the allocation of bonds over time in order to reduce volatility as an investor approaches retirement. Stocks are generally more volatile than bonds, and investors generally increase the percentage of bonds to add the stability to a portfolio of investments.

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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 8575 and, on Monday, fell 156 points.

• On Tuesday, the Dow Jones Industrial Average rose 50 points.

• On Wednesday, the Dow Jones Industrial Average fell 184 points.

• On Thursday, the Dow Jones Industrial Average jumped 46 points.

• On Friday, the Dow Jones Industrial Average dropped 62 points and closed the week at 8269.

Continue reading "Page Perry's Market Monitor - May 15, 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:

• 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" »

The New Jersey state pension fund sued top executives and board members of Lehman Brothers for misrepresentations leading to over $118 million losses due to investments in Lehman Brothers. This pension fund provides benefits to approximately 700,000 current and former employees. According to Terrence Dopp’s article published on Bloomberg, the suit is seeking compensatory and punitive damages for violations of state and federal securities laws, negligent misrepresentation, breach of fiduciary duty, fraud, and aiding and abetting.

Continue reading "State Pension Fund Sues Lehman Executives" »

A growing number of corporations around the country are beginning to assert claims against Wall Street investment firms over Wall Street’s misleading and deceptive marketing of complex structured finance products such as auction-rate securities and collateralized debt obligations. Most recently, American Eagle Outfitters has filed claims accusing Citigroup of fraud in connection with the sale of some $258 million of auction-rate securities. Among the allegations made by American Eagle are that Citigroup misrepresented the auction-rate securities as safe and liquid and that Citigroup omitted to disclose various material facts such as the lack of demand for the auction products and the necessity of support by Citigroup.

Continue reading "Corporations Begin Holding Wall Street Accountable for the Auction-Rate Securities Debacle" »

Compelling pieces of evidence, including sworn statements from Bank of America, have been uncovered indicating that, during recent years, Wall Street brokerage firms conspired to cheat state and local governments and American taxpayers in the municipals markets. Municipal bonds are issued by state and local governments to raise funds for various public projects. Since the proceeds received by the governments are usually not spent all at once, they are invested in various contracts (collectively referred to as Municipal Derivatives) that provide a fixed rate of return or shift the risk of changes in interest rates. The market for Municipal Derivatives is large ($400 billion annually), concentrated among 20 major institutional sellers, and largely unregulated. Before engaging in Municipal Derivatives transactions, governments routinely engage brokers to find the best deals.

Continue reading "More Dishonesty from Wall Street - This Time Cheating State and Local Governments as well as Taxpayers" »