Unit Investment Trusts

Centaurus Financial Sanctioned and Fined by Regulators for Supervisory Failures for the Second Time in Three Months

Published on: May 10, 2023 | by Iorio Altamirano

In a recent regulatory case, on May 5, 2023, the Financial Industry Regulatory Authority (FINRA) Office of Hearing Officers imposed sanctions on Centaurus Financial, Inc. and its financial advisor Donnie Ingram for engaging in unsuitable and unethical practices, as well as supervisory failures. Centaurus Financial, Inc. was censured and ordered to pay a $50,000 fine and $388,962 in restitution to harmed customers. Donnie Ingram was suspended from association with any FINRA member firm in any capacity for six months, fined $15,000, and ordered to pay $388,962 in restitution to harmed customers. The sanctions were the result of Ingram’s unsuitable recommendations to customers to purchase Unit Investment Trusts (UITs), Bluerock Residential Growth REIT Inc. (BRG), and MacKenzie Realty Capital, Inc. (MAC) at higher costs when there were lower cost options available.

Earlier this year, in February 2023, Centaurus Financial also agreed to pay a $750,000 civil penalty after the SEC charged the firm in connection with the unsuitable recommendation of variable interest rate structured products to retail customers. The SEC’s order found that Centaurus failed to implement, and its branch manager failed to follow, Centaurus’ customer-specific suitability procedures and that Centaurus violated the broker-dealer books and records provisions of the federal securities laws. The SEC’s order found that Centaurus violated Sections 17(a)(2) and 17(a)(3) of the Securities Act of 1933 (“Securities Act”) and Section 17(a) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rules 17a-4(e)(5), 17a-4(f)(2), and 17a-3(a)(17)(i)(B)(3) thereunder. The SEC concluded that Centaurus failed reasonably to supervise the firm’s brokers.

Financial institutions like Centaurus Financial, Inc. must properly supervise financial advisors and customer accounts. Brokerage firms must establish and maintain a reasonably designed system to oversee account activity, such as recommendations to purchase alternative investments, such as GWG L Bonds, UITs, and REITS, to ensure compliance with securities laws and industry regulations. When a brokerage firm fails to supervise its financial advisors or the investment account activity sufficiently, it may be liable for investment losses sustained by customers.

SagePoint Financial Broker, Gary Bowman, Suspended by FINRA for Short-Term Trading of Unit Investment Trusts in Customer Accounts

Published on: July 7, 2021 | by Iorio Altamirano

The Financial Industry Regulatory Authority (“FINRA”) has suspended financial advisor Gary Bowman from the securities industry for three months and fined him $10,000. FINRA alleged that between February 2013 through December 2017, Mr. Bowman engaged in an unsuitable pattern of short-term trading of Unit Investment Trusts in customer accounts.

Mr. Bowman has been a stockbroker at SagePoint Financial, Inc. in Corona, CA, since February 2013.

Iorio Altamirano LLP has also been investigating SagePoint Financial, Inc. over Unit Investment Trusts (UIT) early rollover practices.

Investor Alert: Iorio Altamirano LLP Investigates Merrill Lynch Over Unit Investment Trust (UIT) Early Rollover Practices

Published on: June 28, 2021 | by Iorio Altamirano

Iorio Altamirano LLP is investigating claims on behalf of Merrill Lynch, Pierce, Fenner & Smith Incorporated (“Merrill Lynch”) customers who invested in Unit Investment Trusts (UITs). If you have lost money with Merrill Lynch, contact New York securities arbitration lawyers Iorio Altamirano LLP for a free and confidential review of your legal rights.

On June 25, 2021, Merrill Lynch and the Financial Industry Regulatory Authority (“FINRA”) entered into a Letter of Acceptance, Waiver, and Consent No. 2017053437701 (“AWC”) over allegations that between January 2011 and December 2015, Merrill Lynch violated NASD and FINRA rules for failing to maintain an adequate supervisory system and written procedures to monitor Unit Investment Trusts transactions.

As part of the AWC, Merrill Lynch was censured and agreed to a fine of $3.75 million. Merrill Lynch also agreed to pay over $8.43 million in restitution to customers.

New Year’s Resolutions for Investors in 2021

Published on: December 31, 2020 | by Iorio Altamirano

Investing your money is a great way to grow your wealth, save for retirement, and reach your financial goals. If you invest in the appropriate products, you can also receive income from investments, build on-pre-tax dollars, or reduce taxable income.

If you do not invest, you miss out on opportunities to increase your wealth. However, all investments carry risk, and when you invest, you have the potential to lose money.

There are many different types of investments. Some common types of investments include stocks, bonds, certificates of deposit, mutual funds, money market funds, exchange-traded funds, and annuities. There are also more complex investment vehicles, such as real estate investment trusts (REITs), unit investment trusts (UITs), hedge funds, commodities, and private placements.

Investor Alert: Iorio Altamirano LLP Investigates Former Oppenheimer Broker Frederick Levine and Oppenheimer Over Unit Investment Trust (UIT) Early Rollover Practices

Published on: December 16, 2020 | by Iorio Altamirano

Iorio Altamirano LLP is investigating claims on behalf of Oppenheimer customers who invested in Unit Investment Trusts (UITs) at the firm through former Oppenheimer broker Frederick Levine and other financial advisors. If you have lost money with Oppenheimer or former Oppenheimer broker Frederick Levine contact New York securities arbitration lawyers Iorio Altamirano LLP for a free and confidential evaluation of your account.

Financial Advisor Frederick Levine (CRD#: 1765119)

FINRA has suspended financial advisor Frederick Levine from the securities industry for the 3-month period ending on December 20, 2020. He was also fined $5,000.

Investor Alert: Iorio Altamirano LLP Investigates Stifel, Nicolaus & Company Over Unit Investment Trust (UIT) Early Rollover Practices

Published on: December 16, 2020 | by Iorio Altamirano

Iorio Altamirano LLP is investigating claims on behalf of Stifel, Nicolaus & Company customers who invested in Unit Investment Trusts (UITs). If you have lost money with Stifel, Nicolaus & Company, contact New York securities arbitration lawyers Iorio Altamirano LLP for a free and confidential evaluation of your account.

Stifel and FINRA entered into a Letter of Acceptance, Waiver, and Consent (“AWC”) on May 27, 2020, over allegations that between January 2012 and December 2016, Stifel violated FINRA rules. Specifically, that it:

Failed to establish and maintain a supervisory system, and failed to establish, maintain, and enforce written supervisory procedures (“WSPs”) that were reasonably designed to achieve compliance with FINRA’s suitability rule as it pertains to early rollovers of UITs.

Investor Alert: Iorio Altamirano LLP Investigates SagePoint Financial, Inc. Over Unit Investment Trust (UIT) Early Rollover Practices

Published on: December 16, 2020 | by Iorio Altamirano

Iorio Altamirano LLP is investigating claims on behalf of SagePoint Financial customers who invested in Unit Investment Trusts (UITs). If you have lost money with SagePoint, contact New York securities arbitration lawyers Iorio Altamirano LLP for a free and confidential evaluation of your account.

SagePoint and FINRA entered into a Letter of Acceptance, Waiver, and Consent (“AWC”) on June 10, 2020, over allegations that between January 2013 and December 2017, SagePoint violated FINRA rules. Specifically, that it:

Failed to establish and maintain a supervisory system, and failed to establish, maintain, and enforce written supervisory procedures (WSPs) that were reasonably designed to supervise the suitability of representatives’ recommendations to customers for early rollovers of Unit Investment Trusts (UITs).

Oppenheimer Financial Advisor Ivan Shore (CRD# 1012943) SUSPENDED by FINRA for Short-Term Trading of Unit Investment Trusts in Customer Accounts – New York, NY

Published on: November 6, 2020 | by Iorio Altamirano

FINRA has suspended financial advisor Ivan Shore from the securities industry for three months and fined him $5,000. Ivan Shore has been a stockbroker at Oppenheimer & Co. Inc. since 1997.

FINRA alleged that between July 1, 2011, and December 31, 2015, Ivan Shore engaged in an unsuitable pattern of short-term trading of Unit Investment Trusts in customer accounts.

If you have lost money with Ivan Shore, contact New York securities arbitration law firm Iorio Altamirano LLP for a free and confidential evaluation of your accounts.