A recent article in Forbes examined why elderly parents are susceptible to scams that seem obvious to younger individuals. According to the article, there are three main reasons for this: isolation and loneliness, diminished cognition and feelings of financial insecurity. Fraudsters know how to talk to lonely elders in a way that garners trust and makes them feel engaged. In addition, Alzheimer’s Disease research indicates that the first kind of judgment to be impaired is financial judgment, which may go undetected in the beginning stages of Alzheimer’s.

In one example, Gary H. Lane, a former Bank of America financial advisor, pleaded guilty to five counts of tax evasion and 12 counts of fraud on September 3, 2013 and was sentenced to a 10-year prison sentence on February 10, 2014. Allegedly, Lane defrauded six investors of more than $2 million from January 2010 until March 2011. During that time, Lane was reportedly employed by Bank of America Investment Services. Allegedly, Lane convinced these clients to invest their money through an E-trade account instead of following normal bank procedures.

According to the allegations, Lane sought out elderly or unsophisticated investors who were risk-averse and desired high returns. Fortunately, Lane was caught and ordered to pay restitution to his elderly victims. But securities arbitration lawyers say that many elderly investors are not so lucky. The best way to avoid and detect affinity fraud is for the loved ones of elderly investors to be alert for potential fraud and contact an investment fraud lawyer immediately if they believe fraud has occurred.

If your loved ones have suffered significant losses as a result of affinity fraud, they may be able to recover their losses through securities arbitration. To find out more about their legal rights and options, contact a securities arbitration lawyer at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 or newcases@investorlawyers.net for a no-cost, confidential consultation.

FINRA’s investigation of the two brokers found that they allegedly collaborated to steal approximately $300,000 from one of their clients, a widow who had diminished mental capacity. Reportedly, the client held accounts at both JP Morgan and a related bank affiliate. She sold two annuities between April and July 2013 and deposited the proceeds — approximately $300,000 — into a bank account that had been opened for her by Arevalo.

Subsequently, the funds were allegedly withdrawn using two cashier’s checks. On the same day, the money was allegedly deposited by Caballero into a joint account he opened at a different bank in his name and the client’s name. When the deposits were questioned by the bank and further confirmation was required, Arevalo allegedly drove the client to the bank so she could confirm the source of the funds.

Once the deposits were cleared, numerous checks payable to Arevalo and personal debit card purchases allegedly made by Caballero and Arevalo depleted the funds in the account. These purchases allegedly included real estate loan payments, various retail purchases and a payments on a car loan. The investor was not aware of the purchases or withdrawals on the account and allegedly did not give any authorization for these transactions.

Caballero and Arevalo were registered with Chase Investment Securities until around October 2012, when it merged with JP Morgan. At that time, they became JP Morgan-registered brokers. According to stock fraud lawyers, firms have a responsibility to adequately supervise their registered representatives and can be held liable for client losses if they fail to provide such supervision. Reportedly, the two brokers failed to cooperate with FINRA’s investigation but JP Morgan has reimbursed the victim for the stolen funds.

If you lost money because of broker theft or misconduct, you may be able to recover damages via FINRA arbitration. To find out more about your legal rights and options, contact a stock fraud lawyer at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 or newcases@investorlawyers.net for a no-cost, confidential consultation.

The charges were filed by the Securities and Exchange Commission and claim that Snisky used insurance agents to sell Arete LLC interests, which he claimed were safer and more profitable than annuities. Furthermore, the SEC’s claims allege that Snisky told investors that their funds would be used to purchase government-backed agency bonds at a discount by eliminating middlemen fees, which would then be used for overnight banking sweeps. However, he allegedly misappropriated around $2.8 million, using these funds to pay commissions and mortgage payments. According to securities arbitration lawyers, scams like this are far too common and, unfortunately, many investors are either unaware or too embarrassed to come forward.

Reportedly, Snisky described Arete LLC as an “annuity plus” with up to 7 percent in guaranteed annual returns. Furthermore, he allegedly claimed that investors could earn interest and take principal from the investment without penalty, even after 10 years. According to the SEC’s allegations, Snisky stated that the investments were safe, exhibited falsified investor account statements that showed earnings to staff and drafted documents to be used as offering materials by salespeople.

Unfortunately, seniors are common targets for fraud because they often have sizeable savings or retirement funds, according to investment fraud lawyers. In addition, health problems, mental issues and a trusting disposition are other reasons they are targeted by fraudsters.

If you or a loved one has been the target of elder financial abuse through affinity fraud or other investment fraud schemes, you may be able to recover losses through securities arbitration. To find out more about your legal rights and options, contact a securities arbitration lawyer at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 or newcases@investorlawyers.net for a no-cost, confidential consultation.

The AWC states that “at relevant times, Busch worked in various branch offices of WFA located in the Firm’s affiliated bank. Many of Busch’s customers had both Wells Fargo brokerage accounts and Wells Fargo bank accounts, and Busch had access to his customers’ bank account information. From approximately 2006 to 2013, Busch utilized his customers’ bank account information to misappropriate approximately $1.3 million from approximately eight of his Wells Fargo brokerage customers, most of whom were elderly women.”

Furthermore, according to the AWC, Busch primarily used several methods to misappropriate the money. He contacted his credit card company to request payments from the Wells Fargo bank accounts of his customers to his personal credit card account, providing his credit card company with the bank account and routing numbers of his customers. Prior to 2009, he used a manual process with paper debit memos and from 2009 to 2013 he called the automated system for his credit card company. In some cases, he allegedly generated cash by liquidating securities contained in the brokerage accounts of his customers and then transferred the cash to his customers’ bank accounts before misappropriating the funds.

Financial Industry Regulatory Authority rules have established that firms must properly supervise brokers’ activities while they are registered with the firm. Because Busch was registered with Wells Fargo Advisors at the time of his alleged misconduct, the firm could be held responsible for his activities and, thus, could be ordered to compensate his clients for losses sustained for the period he was registered with the firm.

If you suffered significant losses as a result of conducting business with Busch or another Wells Fargo Advisors representative, you may be able to recover your losses through securities arbitration. To find out more about your legal rights and options, contact a stock fraud lawyer at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 for a no-cost, confidential consultation.

Currently a broker at Newport Coast Securities, Holzer has also worked with a number of other firms, including UBS, Brookstreet Securities Corporation, AG Edwards, Wedbush Morgan Securities Inc. and Sequoia Equities Securities. Holzer and UBS have already been compelled to pay to settle securities claims amounting to $11.4 million. These claims alleged that Holzer misrepresented variable annuities through misrepresentation of guaranteed returns. Holzer was fired from AG Edwards in 2003 for allegedly engaging in business practices that did not coincide with the firm’s policies. Further allegations against Holzer include misrepresentations while at Brookstreet. These misrepresentations allegedly occurred in 2005 at a Beverly Hills presentation at which Holzer allegedly stated that a fictional couple was able to make $9 million by deferring $732,000 in taxes through the use of trusts. In another claim, a customer of Wedbush Morgan Securities alleged breach of fiduciary duty, account mishandling, and breach of contract that allegedly resulted in damages of $824,000.

According to securities fraud attorneys, allegations against Holzer include fraud, churning, unsuitable investments, misrepresentations of fees, Securities Act violations, private placement-related fraud, negligent representations related to variable annuities, inadequate supervision, variable annuity-related fraud, negligent recommendation and sale of Provident Royalties LLC, negligent sale and recommendation of Behringer Harvard Security trust and other unsafe products as well as elder abuse.

Stock fraud lawyers say that in many cases, investment firms can still be held liable for a broker’s actions if their supervision of that broker was negligent. As a result, it may possible for investors to recover their losses from Holzer or the brokerage firm she was employed with when the fraud occurred.

If you have a claim arising from the conduct of Bambi Holzer or another financial advisor, you may be able to recover losses through securities arbitration. To find out more about your legal rights and options, contact a securities fraud attorney at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.

It is clear to securities fraud attorneys, who regularly file claims on behalf of elderly individuals, that financial abuse against the elderly is a common problem. This sentiment was reflected in the June 15 announcement by the CFPB.

“Older Americans have lost billions of dollars to the silent crime of financial exploitation,” says Richard Cordray, CFPB director. “Our older adult population is growing every year, which makes it even more critical that we study this issue. Today, the Bureau will launch a public inquiry to learn more about financial fraud of older Americans and the credentials of financial advisors who counsel them.”

The CFPB’s public inquiry will investigate several issues regarding elder financial abuse. These issues include:

• Determining what effective resources exist to aid seniors in making informed decisions about their brokers or financial advisors.
• Determining what the public and individuals working with elders think about the current methods for determining authenticity and legitimacy of financial advisors’ and financial planners’ credentials.
• Determining what financial counseling, education or management programs are specifically designed for suiting the needs of older Americans, and the effectiveness of current programs.
• Determining what sources compile information on misleading or fraudulent uses of “senior certifications” that are publicly available.
• Determining the details of different forms of deceptive, unfair or abusive practices specifically targeted at Americans of at least 62 years of age. These abusive practices include affinity fraud, power of attorney abuse and other forms of exploitation.
• Determining the details of different forms of deceptive, unfair or abusive practices that target military retirees and older veterans, including military retirement and pension fund fraud.

With the high number of arbitration claims being filed on behalf of older and retired individuals, investment fraud lawyers are glad to see agencies like the CFPB focusing on this issue in an effort to reduce the instances of elder financial abuse.

If you believe you or a loved one has been the victim of any type of financial elder abuse, contact a securities fraud attorney at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.

Ephren Taylor, who credited himself as the youngest black chief executive of a publicly-traded company in American history, appeared on CNN and NPR, and was a Democratic National Convention speaker, was endorsed at one of his “Wealth Tour Live” seminars by Eddie Long, pastor of the New Birth Missionary Baptist Church with the words, “[God] wants you to be a mover and a shaker… to finance you well to do His will.” Taylor then offered “low risk investment with high performances” to the Pastor’s flock. Taylor now stands (whereabouts unknown) accused of fraud. The full extent of investor losses as a result of Taylor’s fraud is yet to be determined because of the complicated web of companies, both legitimate and shell.

While many individuals that are targeted for stock broker fraud are elderly and/or uninformed, these are not the only victims of affinity fraud. One man who was taken in by Ephren Taylor had an MBA and was an electrical engineer. A Utah man in another affinity fraud case, who was taken for $50,000, had worked on white-collar fraud cases as a federal agent before his retirement.

Currently, 1,000 cases of investment fraud are being probed by the FBI. This is more than double the number of investment fraud cases that were outstanding in 2008. Sadly, the difficult economic times that will have investors believing almost anything that promises financial security also brings more and more fraudsters out of the woodwork. If you believe you have been the victim of affinity fraud, contact an investment attorney at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.

Other reported statistics include:

• 7,000 total investigations, 3,475 of which led to enforcement actions
• Nearly 1,000 actions that involved fraud and abuse of senior citizens
• $170 million in state-levied fines or penalties
• $14 billion in restitution paid to investors
• $31.2 million in state costs or expenses
• 2,595 stockbroker licenses withdrawn
• 647 stockbroker licenses denied, suspended, revoked or made conditional
• 1,134 years of incarceration dealt out

Fraud and abuse of senior citizen cases involved promissory notes, investment contacts, private offerings, affinity fraud, variable annuities and “free lunch” investment seminar scams. Despite the rise in enforcement actions, the number of investigations fell slightly from 7,086 in 2009 to 7,063 in 2010. The amount of money collected in fines and penalties also fell from 2009 to 2010, but there was an increase in restitution paid to investors.

This report can only measure cases of securities fraud that were actually reported. However, the number of incidences is believed to be much higher, as many cases go unreported. According to the report, 2010’s most problematic products, in order of frequency, were Rule 506 offerings, real estate investments or interests, oil and gas interest, structured products, hedge funds or private equity funds, variable annuities, viaticals or life settlements, precious metal commodities, non-precious metal commodities and equity-indexed annuities.

The NASAA, organized in 1919, is a voluntary association, and of all the organizations devoted to investor protection, it is the oldest. All 50 states, Canada, Mexico, the U.S. Virgin Islands, the District of Columbia and Puerto Rico are represented in the NASAA’s securities administrators membership.

If you believe you have become a victim of stockbroker fraud in 2011, contact an investment attorney at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.

Online social networking is good news for scammers because they don’t have to worry about that pesky “sixth sense” some people get when they are physically near someone who is up to no good. Limiting the social interaction to online encounters in the beginning helps scammers get past the initial phase of their plan — gaining your trust. Not only is it easier to gain your trust, but they can work at it any time and from anywhere.

According to Melanie Woods, the Indiana Investor Education Coordinator, the average Facebook user has connections with 80 community pages, events and groups. Each one of these connections is an opportunity for scammers to take advantage of the individual.

While it’s a dangerous world out there, there are a few precautions investors can take to avoid affinity fraud:

• When accepting friends, make sure you know who they are. Remember, just because they ask to be your “friend” online, they are not your friend in the investment world.
• Don’t include sensitive personal information on your profile such as address, phone number, birth date and employment history. Even citing your political or religious views can be dangerous, as it gives scammers common ground to begin establishing trust.
• Watch for “red flags” like no risk/high return promises, offshore-based operations and e-currency website payment requests.
• As always, if you are considering investing, check into the reputation of the firm or individual as well as the investment itself before investing.

If you believe you have been the victim of affinity fraud, contact an investment attorney at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.

According to the U.S. Attorney’s office, about 2,000 victims lost a total of around $10.7 million. The fraud targeted African-Americans and many of the victims could be found at Chicago churches and hotels. The Fluker family fraud took place between 2005 and 2008, yielded a profit of around $18 million, and resulted in the acquisition of some of their victims’ homes. The Flukers’ “Housing Program” was supposed to reduce mortgage payments and result in total ownership in five years. Their “Spend and Redeem Program,” a financial and educational program, boasted a 200 percent profit in one year. The fraud was conducted through two companies, All Things in Common LLC (also known as More Than Enough) and Locust International LLC.

The trial that concluded in 2010 ordered $9 million preliminary forfeiture judgments and $7.34 million in restitution. After freezing the Flukers’ accounts, about $3.4 million was recovered by the Illinois Attorney General’s office. The recovered amount, combined with the restitution amount ordered, will go to replaying the targeted victims who had not yet been repaid.

If you believe that you have been the victim of fraud, contact the Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation with an investment attorney.