According to an article that appeared in The Wall Street Journal on April 4, 2022 GWGH is reportedly preparing to file for Chapter 11 bankruptcy in the coming days. A bankruptcy filing would likely cause delays in payments of interest and principal to holders of GWGH L Bonds, and might also imperil the repayment of principal in whole or in part.

GWGH reportedly has about $1.6 billion in principal value of L Bonds outstanding. While no one knows for sure where L Bond investors will land in the event of a bankruptcy, the publication Investment News has reported that one anonymous GWGH L bond investor estimates that the GWG L Bonds would be worth 20 to 30 cents on the dollar if GWGH files for bankruptcy.

The possible bankruptcy is just the latest adverse event surrounding GWGH. Only last week, GWGH announced that it could not timely make its annual report filing with the Securities and Exchange Commission. GWGH has now failed to timely file annual reports with the SEC in three of the past four years. Further complicating matters, GWGH currently has no auditor. It last auditor, Grant Thornton, resigned in December 2021.

As previously discussed on this blog, on February 14, 2022 GWGH officially defaulted on its obligations to L Bond investors and confirmed in a letter to investors that it will not be making monthly interest or maturity payments on its GWGH L Bonds, or accepting redemption requests, while it continues to identify and evaluate restructuring alternatives with its advisors. Now it appears that this unspecified “restructuring alternative” will be a declaration of bankruptcy.

GWGH L Bonds are high-yield life insurance bonds used to finance the purchase of life insurance on the secondary market. Any type of investment in the secondary life insurance market is an extremely risky investment. While GWCH reportedly has close to $1 billion in tangible assets, the company also has over $1.5 billion in outstanding L Bonds, plus $327.7 million owed in senior credit facilities.

GWGH is a Dallas-based financial services firm that offers a variety of ‘services including life insurance and alternative investments. GWGH sold millions of dollars’ worth of L Bonds over the past several years, including sales to public investors through brokerage firms. L Bonds are a financial product that purportedly offers higher yields than typical publicly traded bonds. L Bonds are sold by life insurance companies that buy back the policies from policyholders. The bonds are supposed to help finance the purchase of the policies. According to a prospectus published by GWGH for the offering of $2 billion of L Bonds, the bonds were sold with varying maturity terms ranging from 2 years to 7 years, with interest rates ranging from 5.50% to 8.50%.

Broker dealers are required to perform adequate due diligence on any investment they recommend. They must ensure that all recommendations are suitable for the investor. Recommendations should be in line with the investor’s age, risk tolerance, net worth, and investment experience. If brokerage firms fail to adequately disclose risks or make unsuitable investment recommendations can be held liable for investment losses.

Investors who wish to discuss a possible claim involving GWGH securities may contact a securities arbitration lawyer at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 or via email at newcases@investorlawyers.net for a no-cost, confidential consultation. Attorneys at the firm are admitted in New York, Wisconsin and various federal courts around the country, and handle cases nationwide (in cooperation with attorneys located in those states if required by applicable rules).

This article is intended as ATTORNEY ADVERTISING and is not an official announcement.

According to a January 18, 2022 Form 8-K filing with the Securities and Exchange Commission (SEC) the Board of Directors of GWG Holdings, Inc. (GWGH) has authorized GWGH’s management to retain the services of a restructuring advisor. According to the same filing, GWGH expects t retain FTI Consulting, Inc. as its restructuring advisor, and Mayer Brown LLP as restructuring legal advisor “to assist the Company’s Board of Directors and management in evaluating alternatives with respect to its capital structure and liquidity.”

The putative restructuring comes amid continued financial struggles for GWGH. GWGH had previously announced mounting losses, including $169.9 million in the first nine months of 2021 and a total of $168.5 million for fiscal year 2020. GWGH has also disclosed a going concern and material weakness in internal controls in its recent financial filings. The going concern disclosure indicates there is substantial doubt about GWGH’s ability to meet its financial obligations as they come due over the next 12 months due to GWGH’s recent inability to raise capital, recurring losses from operations, and potential negative implications of the ongoing SEC non-public, fact-finding investigation. The internal controls disclosure indicated that management had determined that GWGH’s internal controls were not sufficient to ensure amounts recorded and disclosed were fairly stated in accordance with GAAP. In summary, GWGH has disclosed its reported financial results’ accuracy cannot be relied upon, and that it may not be able to stay in business for any sustained period going forward.

How GWGH’s struggles will ultimately impact L Bond holders and other holders of securities of the company is unknown, but according to its filings with the Securities and Exchange Commission (“SEC”), GWGH has halted the sale of the L Bonds and failed to issue $10.35 million of interest payments and $3.25 million of principal payments to L Bond investors by the January 15, 2022 due date. GWGH L Bonds are high-yield life insurance bonds used to finance the purchase of life insurance on the secondary market. Any type of investment in the secondary life insurance market is an extremely risky investment. GWGH also has outstanding shares of common stock and preferred stock, in addition to L Bonds.

GWGH has previously announced that on October 6, 2020, GWCH received a subpoena to produce documents from the Chicago office of the SEC’s Division of Enforcement, as part of a non-public, fact-finding investigation into GWG Holdings. Since the initial subpoena, the Company has reportedly received subsequent subpoenas from the SEC for additional information. According to publicly available information in GWCH’s SEC filings, the requested information from the SEC has primarily related to GWG Holdings’ investment products, including its L Bonds, as well as various accounting matters.

Investors who wish to discuss a possible claim involving GWGH securities may contact a securities arbitration lawyer at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 or via email at newcases@investorlawyers.net for a no-cost, confidential consultation. Attorneys at the firm are admitted in New York, Wisconsin and various federal courts around the country, and handle cases nationwide (in cooperation with attorneys located in those states if required by applicable rules).

This article is intended as ATTORNEY ADVERTISING and is not an official announcement.

GWGH recently failed to make a scheduled interest payment of over $10 million due on certain securities sold to investors known as “L Bonds”. GWGH’s common stock price has also plummeted by over half in 2022, from an opening price of $9.80 a share on January 3, 2022 to a closing price of $4.11 a share on January 25, 2022.

GWGH is a Dallas-based financial services firm that offers a variety of ‘services including life insurance and alternative investments. GWGH sold millions of dollars’ worth of L Bonds over the past several years, including sales to public investors through brokerage firms. L Bonds are a financial product that purportedly offers higher yields than typical publicly traded bonds. L Bonds are sold by life insurance companies that buy back the policies from policyholders. The bonds are supposed to help finance the purchase of the policies. According to a prospectus published by GWGH for the offering of $2 billion of L Bonds, the bonds were sold with varying maturity terms ranging from 2 years to 7 years, with interest rates ranging from 5.50% to 8.50%.

In March 2021, GWGH notified the Securities and Exchange Commission (SEC) that it could not timely file its Forms 10-K and 10-Q, which are annual and quarterly financial reports and company disclosures. GWG said it needed additional time to complete these financial statements and related disclosures. This prompted a deficiency letter from Nasdaq in April 2021.

Now, the Board of Directors of GWGH has reportedly authorized management to retain the services of a restructuring advisor, which the Company expects will be FTI Consulting, Inc., and Mayer Brown LLP as restructuring legal advisor to assist the Company’s Board of Directors and management in evaluating alternatives with respect to its capital structure and liquidity.

GWGH suspended its L Bonds sales effective as of January 10, 2022. GWG had previously suspended sales of L Bonds for eight months during 2021 due to the fact that it was unable to timely file its Annual Report with the SEC. GWG now says that its 2021 Annual Report also likely will not be filed on time.

GWGH’s independent accounting firm, Grant Thornton, has declined to stand for reappointment. Although it publicly stated that it did not have any disagreements during the year ended December 31, 2020 and through January 6, 2022 with GWGH concerning accounting principles or practices or financial statement disclosure, Grant Thornton also had previously stated as follows with respect to GWGH: “As of December 31, 2020, the design and operating effectiveness of controls over the selection, application and review of the implementation of accounting policies were not sufficient to ensure amounts recorded and disclosed were fairly stated in accordance with GAAP. This material weakness resulted in the Restatement.”

GWGH also did not make the January 15, 2022 interest payment of approximately $10.35 million and principal payments of approximately $3.25 million with respect to its outstanding L Bonds.

Broker dealers are required to perform adequate due diligence on any investment they recommend. They must ensure that all recommendations are suitable for the investor. Recommendations should be in line with the investor’s age, risk tolerance, net worth, and investment experience. If brokerage firms fail to adequately disclose risks or make unsuitable investment recommendations can be held liable for investment losses.

Investors who wish to discuss a possible claim involving GWGH securities may contact a securities arbitration lawyer at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 or via email at newcases@investorlawyers.net for a no-cost, confidential consultation. Attorneys at the firm are admitted in New York, Wisconsin and various federal courts around the country, and handle cases nationwide (in cooperation with attorneys located in those states if required by applicable rules).

The foregoing article is intended as ATTORNEY ADVERTISING and is not an official notice.

Allegedly, Morgan Stanley did not adequately disclose the risk associated with the recommended investment strategy of concentrating all of their funds into these three investments. The firm also allegedly failed to adequately disclose the risks associated with low credit ratings and long-duration bonds. Allegedly, the couple was led to believe that the Puerto Rico Bonds were constitutionally guaranteed by the Commonwealth of Puerto Rico.

Some of the bonds and bond funds currently being investigated by securities fraud attorneys are:

• Puerto Rico Sales Tax Financing Corp.
• Puerto Rico Public Finance Corp.
• Puerto Rico Electric Power Authority
• Puerto Rico Mortgage Backed & US Govt. Fund
• Puerto Rico Fixed Income Funds I-VI
• Puerto Rico AAA Portfolio Bond Funds I and II
• Puerto Rico AAA Portfolio Target Maturity Fund
• Puerto Rico Investors Bond Fund II
• Puerto Rico Investors Tax-Free Funds I-VI
• Puerto Rico GNMA &US Gov. Target Maturity Fund
• Puerto Rico Tax-Free Target Maturity Fund I and II
• Tax-Free Puerto Rico Target Maturity Fund
• Tax-Free Puerto Rico Funds I and II

If you suffered significant losses as a result of purchasing unsuitable Puerto Rico Bonds from Morgan Stanley, you may be able to recover your losses through FINRA arbitration. To find out more about your legal rights and options, contact a 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 Financial Industry Regulatory Authority (FINRA) recently filed a complaint against two MetLife Securities Inc. brokers, Patrick Chapin and Christopher Birli. According to the complaint, Chapin and Birli focused on advising State University of New York employees on their retirement plan. Both were terminated in 2012 and do not work in the securities industry at this time.

According to the complaint, Chapin and Birli allegedly made recommendations to 45 of their customers to unload their plan’s MetLife variable annuities by cashing in their annuities, purchasing another security within the plan to be held for 90 days, and then selling that security to switch to new variable annuities outside the university plan, held in IRAs. The alleged misconduct took place between 2004 and 2007. According to FINRA, this scheme generated commissions for the brokers amounting to hundreds of thousands of dollars.

According to stock fraud lawyers, the brokers’ actions exposed investors to unnecessary risks. Reportedly, in order to cash in their plan’s annuities, some investors were required to pay fees, and investor funds were tied up in the new annuities for up to seven years. Brokers have an obligation to fully disclose all the risks of a given investment when making recommendations, and those recommendations must be suitable for the individual investor receiving the recommendation given their age, investment objectives and risk tolerance. Securities fraud attorneys say that many investors may have received unsuitable recommendations related to variable annuities.

If you received an unsuitable recommendation regarding variable annuities and suffered significant losses as a result, 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 or newcases@investorlawyers.net for a no-cost, confidential consultation.

A claim was recently filed on behalf of one couple who wanted to invest the money from their matured CDs in conservative investments. However, Oriental Financial Services allegedly recommended they invest 65 percent in the Puerto Rico Closed-end Bond Funds. According to the claim, the couple was unaware that this significant portion of their $1 million investment would be put into investments that were illiquid, concentrated, high-risk and leveraged. Reportedly, when the Puerto Rico market declined, their investment value declined by around 60 percent. In addition, the couple is unable to get out of their declining investments because there is no secondary market readily available.

Under FINRA rules, firms have an obligation to fully disclose all the risks of a given investment when making recommendations, and those recommendations must be suitable for the individual investor receiving the recommendation given their age, investment objectives and risk tolerance. According to stock fraud lawyers, many of the investors who have suffered significant losses in Puerto Rico closed-end bond funds were unaware of the risks, and these investments were unsuitable given their risk tolerance.

Some of the funds currently being investigated by securities fraud attorneys are:

• Puerto Rico Mortgage Backed & US Govt. Fund
• Puerto Rico Fixed Income Funds I-VI
• Puerto Rico AAA Portfolio Bond Funds I and II
• Puerto Rico AAA Portfolio Target Maturity Fund
• Puerto Rico Investors Bond Fund II
• Puerto Rico Investor’s Tax-Free Funds I-VI
• Puerto Rico GNMA &US Gov. Target Maturity Fund
• Puerto Rico Tax-Free Target Maturity Fund I and II
• Tax-Free Puerto Rico Target Maturity Fund
• Tax-Free Puerto Rico Funds I and II

If you suffered significant losses in Puerto Rico closed-end bond funds from Oriental Financial Services, or another full-service brokerage firm, you may be able to recover your losses through FINRA 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 or newcases@investorlawyers.net for a no-cost, confidential consultation.

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Source:

http://www.nasdaq.com/press-release/the-securities-arbitration-law-firm-of-klayman–toskes-and-carlo-law-offices-file-500000-claim-20140211-00975

Keywords: securities fraud attorney, stock fraud lawyer

Tags: Oriental Financial Services, Puerto Rico Closed-end Bond Funds, Puerto Rico Investors Tax Free Fund IV, Puerto Rico Income Fund II, Puerto Rico Mortgage Backed & US Govt. Fund, Puerto Rico Fixed Income Funds I-VI, Puerto Rico AAA Portfolio Bond Funds I and II, Puerto Rico AAA Portfolio Target Maturity Fund, Puerto Rico Investors Bond Fund II, Puerto Rico Investor’s Tax-Free Funds I-VI, Puerto Rico GNMA &US Gov. Target Maturity Fund, Puerto Rico Tax-Free Target Maturity Fund I and II, Tax-Free Puerto Rico Target Maturity Fund, Tax-Free Puerto Rico Funds I and II

This is bad news for a lot of investors, as about 70 percent of U.S. municipal bond funds currently hold some portion of Puerto Rico bonds and those funds that are required to hold investment-grade bonds will be forced to sell the Puerto Rico bonds at significant discounts. According to stock fraud lawyers, this selling pressure may result in bond holders seeing significant price drops. In addition, the downgrade could throw a wrench in Puerto Rico’s plan to borrow $1-2 billion in the near future. Puerto Rico would likely have to agree to a much higher interest rate for investors to accept the risks associated with the bonds.

Puerto Rico bond investors suffered losses of more than 20 percent in 2013, with even higher losses for investors who were exposed to the internal leverage (or borrowing of money to buy additional municipal bonds) in UBS Puerto Rico bond funds. Investors who were 50 percent leveraged reportedly experienced losses of around 40 percent. In addition, securities fraud attorneys say that many investors were convinced to use a margin account, a second mortgage or a bank loan to borrow more money for larger investments. Both of these recommendations carried significant risk and were unsuitable for many investors.

Under FINRA rules, firms have an obligation to fully disclose all the risks of a given investment when making recommendations, and those recommendations must be suitable for the individual investor receiving the recommendation given their age, investment objectives and risk tolerance.

If you received an unsuitable recommendation of Puerto Rico bond funds (either by UBS Puerto Rico or another brokerage firm) and suffered significant losses as a result, 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 at (866) 966-9598 or newcases@investorlawyers.net for a no-cost, confidential consultation.

In one claim already filed by stock fraud lawyers, the claimant, one of Lugo’s clients, seeks to recover approximately $15 million. According to the allegations in this claim and others, Lugo reportedly recommended that his clients invest significant portions of their accounts in UBS proprietary Puerto Rico municipal bond funds and Puerto Rico municipal bonds. In addition, the amount invested frequently represented large concentrations of the total net worth of the client. Reportedly, these investments were marketed and sold as low-risk and clients were told they would be paid high, tax-advantaged dividends.

Lugo’s clients also allege that they were not warned that the UBS bond funds were highly leveraged. Lugo also allegedly recommended a UBS margin account in order to borrow funds to increase his clients’ Puerto Rico municipal bond investments. While this investment strategy was highly speculative and posed a high risk of principal loss, Lugo allegedly did not warn his clients of the risks and made unsuitable recommendations.

Reportedly, UBS Financial Services offered to buy back some shares of the Puerto Rico closed-end bond funds last month, following the funds’ significant decline in value. However, the shares will be repurchased at net asset value or below and a cap has been placed on the fund to prevent any more than 25 percent of the outstanding shares to be repurchased. According to securities fraud attorneys, the buyback program may be an attempt to discourage individual arbitration claims and actual investor recovery could be much lower than the shares’ net value.

If you suffered significant losses in UBS Puerto Rico bond funds because of the unsuitable recommendations of David Lugo or another UBS 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 or newcases@investorlawyers.netfor a no-cost, confidential consultation.

Both Standard & Poor and Moody had already put Puerto Rico’s general obligation municipal bonds on negative watch when Fitch Ratings joined them on November 14. The Puerto Rico bonds are already rated by all three agencies at just one step above “junk,” or non-investment grade. Currently, Puerto Rico has outstanding debt amounting to around $11 billion in this category, and securities arbitration lawyers say that the negative watch given to the bonds by all three rating agencies is an indication that the debt will likely be downgraded in the coming months to junk-bond status.

If these bonds are downgraded to junk status, the resulting flood of sales could cause another drastic drop in the bonds’ price, and could also result in losses in closed-end mutual funds invested in the bonds. Unfortunately, most buyers are unwilling to accept the risk of purchasing these bonds unless significantly discounted, leaving many investors forced to keep the investment or sell it at a significant loss.

Some of the funds currently being investigated by investment fraud lawyers are:

• Puerto Rico Mortgage Backed & U.S. Government Fund
• Puerto Rico Fixed Income Funds I-VI
• Puerto Rico AAA Portfolio Bond Funds I and II
• Puerto Rico AAA Portfolio Target Maturity Fund
• Puerto Rico Investors Bond Fund II
• Puerto Rico Investor’s Tax-Free Funds I-VI
• Puerto Rico GNMA & U.S. Government Target Maturity Fund
• Puerto Rico Tax-Free Target Maturity Fund I and II
• Tax-Free Puerto Rico Target Maturity Fund
• Tax-Free Puerto Rico Funds I and II

If you suffered significant losses in funds invested in Puerto Rico bonds through UBS Financial Services or another financial advisor, you may be able to recover your losses through FINRA 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.

Investment fraud lawyers at the Law Office of Christopher J. Gray P.C. recently filed a securities arbitration claim with the Financial Industry Regulatory Authority regarding UBS Puerto Rico investments. This case, which was filed on behalf of a retiree, focuses on one of a group of closed-end funds structured by UBS Puerto Rico, known as the Puerto Rico Fixed Income Fund I.

According to the allegations stated in the claim, Fund I was marketed and sold as a safe fixed-income investment, and was primarily invested in bonds issued by the Puerto Rican government. However, according to securities arbitration lawyers, because these funds suffered heavy exposure to the Puerto Rico government-issued bonds, there were substantial risks associated with the fund’s concentration these bonds in the event that they lost value. Due to their leveraged exposure to Puerto Rico government bonds, the value of the close-end funds has significantly declined as the underlying municipal bonds have dropped in price.

Fund I had a stated value of $8.55 per share as of July 2013. However, the value per share dropped to $6.06 in September and, as of October 1, shares of Fund I were only valued at $3.73. There are 23 closed-end funds currently in question, some of which have lost more than half their value, according to recent reports. Some of the funds currently being investigated by investment fraud lawyers are:

• Puerto Rico Mortgage Backed & US Govt. Fund
• Puerto Rico Fixed Income Funds I-VI
• Puerto Rico AAA Portfolio Bond Funds I and II
• Puerto Rico AAA Portfolio Target Maturity Fund
• Puerto Rico Investors Bond Fund II
• Puerto Rico Investor’s Tax-Free Funds I-VI
• Puerto Rico GNMA &US Gov. Target Maturity Fund
• Puerto Rico Tax-Free Target Maturity Fund I and II
• Tax-Free Puerto Rico Target Maturity Fund
• Tax-Free Puerto Rico Funds I and II

If you suffered significant losses as a result of the improper recommendation of, or an over-concentrated investment in, one of the Puerto Rico closed-end funds, you may be able to recover your 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 for a no-cost, confidential consultation.

According to securities arbitration lawyers, many state-specific municipal bond funds contained Puerto Rico debt and, as a result, other investigations may ensue. According to Massachusetts Secretary of the Commonwealth, William Galvin, the investigation includes three large fund managers: OppenheimerFunds (a unit of MassMutual Life Insurance Co.), UBS Financial Services and Fidelity Investments. The investigation is regarding how these managers sold and disclosed the risk of mutual funds containing heavy concentrations of the Puerto Rico bonds.

“Puerto Rico is currently on the verge of insolvency and many of its obligations are at or near junk rating, thus the risks associated with its municipal debt obligation are disproportionately high,” Galvin notes.

Investment fraud lawyers say the bonds are attractive to managers of mutual funds because they are state-, federal- and local income tax-exempt in all U.S. states. Some of the funds currently being investigated by securities fraud attorneys are:

• Puerto Rico Mortgage Backed & US Govt. Fund
• Puerto Rico Fixed Income Funds I-VI
• Puerto Rico AAA Portfolio Bond Funds I and II
• Puerto Rico AAA Portfolio Target Maturity Fund
• Puerto Rico Investors Bond Fund II
• Puerto Rico Investor’s Tax-Free Funds I-VI
• Puerto Rico GNMA &US Gov. Target Maturity Fund
• Puerto Rico Tax-Free Target Maturity Fund I and II
• Tax-Free Puerto Rico Target Maturity Fund
• Tax-Free Puerto Rico Funds I and II

If you suffered significant losses in UBS Puerto Rico closed-end bond funds through OppenheimerFunds, UBS Financial Services, Fidelity Investments or another fund manager, you may be able to recover your losses through FINRA securities arbitration. To find out more about your legal rights and options, contact a securities arbitration lawyer at Law Office of Christopher J. Gray at (866) 966-9598, or by e-mail at newcases@investorlawyers.net for a no-cost, confidential consultation.

According to a FINRA news release, on August 22, 2013, the Financial Industry Regulatory Authority fined Morgan Stanley & Co. LLC and Morgan Stanley Smith Barney LLC for failure to provide reasonable prices in certain municipal bond customer transactions and failure to provide best execution in certain corporate and agency bond customer transactions. The firms were fined $1 million and ordered to pay restitution and interest in the amount of $188,000, above and beyond what Morgan Stanley has already paid. Stock fraud lawyers say Morgan Stanley did not admit or deny the FINRA charges.

Reportedly, the violations affected 116 corporate and agency bond customer transactions and 165 municipal bond customer transactions.

“FINRA found that Morgan Stanley failed to use reasonable diligence to ensure that the purchase or sale price to the customer was as favorable as possible under current market conditions,” the FINRA statement reads. “Morgan Stanley failed to purchase or sell bonds at prices reasonably related to the fair market value of the subject security.”

According to securities fraud attorneys, there may be many other customers of Morgan Stanley or other full-service brokerage firms that did not receive fair pricing or best execution in bonds or other securities.

“Firms must ensure that customers who buy and sell securities — including corporate, agency and municipal bonds — receive execution prices that are consistent with prices available in the marketplace,” notes FINRA’s Executive Vice President of Market Regulation Thomas Gira.

If your full-service brokerage firm has a history of best execution and fair pricing violations and your investments were affected, you may be eligible for reimbursement. 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.

The claim, which originally requested $4.3 million in relief, was filed in 2010 by Lawrence B. Dale, an investor in the Intermediate Fund. The award stated that Morgan Keegan allegedly “represented to the claimants that the (bond fund) was a safe and conservative investment.” Further allegations by Dale were that the Intermediate Fund “did not match Morgan Keegan’s misrepresentations, failed to disclose material information, misrepresented values, and invested in structured finance and asset-backed securities” that were unsuitable for Dale. The firm also allegedly failed to adequately supervise its employees, according to Dale.

Securities arbitration lawyers say that Morgan Keegan and Regions Financial have been facing many problems because of the Intermediate Fund and its blowup during the financial crisis. This fund was one of a group that saw a significant decline in net asset value in 2007 and 2008, reportedly between 60 and 80 percent. Furthermore, the firm was later charged by regulators with overstating the value of the funds’ mortgage-backed securities. The firm agreed to pay a fine to regulators amounting to $200 million in 2011. In addition, a civil complaint was filed by the Securities and Exchange Commission against the funds’ former board members in December. According to this complaint, the board members allegedly failed to properly oversee the managers of the fund.

According to stock fraud lawyers, prior to recommending an investment to a client, brokers and firms are required to perform the necessary due diligence to establish whether the investment is suitable for the client, given their age, investment objectives and risk tolerance. If, like Dale, you were recommended Morgan Keen proprietary bond funds despite the fact that they were unsuitable for you, you may have a valid securities arbitration claim. To find out more about your legal rights and options, contact a securities arbitration lawyer at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.

New York City investor Margaret Hill filed the case in 2011 and requested over $3.5 million in damages. Her losses were a result of Citi’s Rochester Municipal Fund. Investment fraud lawyers say Hill’s case alleged that she was sold unsuitable investments by Citigroup Global Markets Inc. which, in addition, misrepresented facts.

According to the allegations against Citigroup, Hill bought the Rochester Fund as an alternative to her individual municipal bond funds because Citigroup said it would pay more interest and would be a “safe” alternative to her funds at that time. However, the Rochester Fund reportedly consisted primarily of tobacco bonds and risky derivative securities. After purchasing the bond in 2007, Hill sold the funds in 2009, suffering losses amounting to $2.9 million.

Securities fraud attorneys say it is often falsely assumed that wealthy investors are more sophisticated investors than the average investor. However, brokerage firms and financial advisors are still responsible for adequately disclosing all risks associated with a particular investment. In this case, the value of the derivative securities that made up the fund depends on the underlying assets’ performance which can experience significant fluctuations.

If you suffered significant losses as a result of your investment in a municipal bond that was falsely represented as “safe,” you may be able to recover you losses through securities arbitration. To find out more about your legal rights and options, contact an investment fraud lawyer at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.

“Fraley, who was a licensed securities professional employed with licensed broker-dealers until he was terminated in 2011, solicited hundreds of thousands of dollars from Colorado investors, promising the investors that their money would be invested in ‘a well-balanced portfolio of investments’ consisting of Roth IRAs, traditional investments such as stocks and bonds, mutual funds and non-qualified investments,” says the statement from Colorado enforcement officials. However, “Fraley gained unauthorized access to the investors’ accounts, forged the investors’ signatures on checks, deposited the money in a Wealth bank account and converted the money for his own personal benefit, including the purchase of a house.”

Stock fraud lawyers say Fraley was registered from March 2007 to May 2011 with Northwestern Mutual Investment Services, a FINRA-registered broker-dealer. Fraley was registered with another FINRA-registered broker-dealer, MML Investors Services, from May 2011 to October 2011. All FINRA-registered broker dealers are, according to securities fraud attorneys, required to properly supervise the activities of their brokers during the time in which they are registered with the firm. As a result, these firms may be held liable for failing to adequately supervise Fraley.

If you suffered significant losses as a result of your investments with Clinton D. Fraley, you may be able to recover your losses through Financial Industry Regulatory Authority arbitration. To find out more about your legal rights and options, contact a stock fraud lawyer at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.

Securities arbitration lawyers say this situation is similar in some ways to what happened when, after Lehman declared bankruptcy, Series 2008A of Main Street Natural Gas Inc. Gas Project Revenue Bonds were downgraded. In the case of the Lehman bonds, the bonds were not guaranteed by Lehman Brothers, though certain payment obligations of the gas supplier were guaranteed.

The following is a list of gas prepayment bonds that have been affected by downgrades:

• Tennessee Energy Acquisition Corporation Gas Project Revenue Bonds, Series 2006A
• Public Energy Authority of Kentucky Inc. Variable Rate Gas Supply Revenue bonds, Series 2006A
• New Mexico Municipal Energy Acquisition Authority Gas Supply Variable Rate Revenue Bonds, Series 2009
• American Municipal Power Inc., OH Electricity Purchase Revenue Bonds, 2007A
• Lancaster Port Authority Gas Supply Variable Rate Revenue Bonds, Series 2008
• Salt Verde Financial Corporation, AZ Senior Gas Revenue Bonds, 2007
• Central Plains Energy Project Gas Project Variable Rate Revenue Bonds (Project No. 2), Series 2009
• Main Street Natural Gas Inc. Gas Project Variable Rate Revenue Bonds, Series 2010
• Texas Municipal Gas Acquisition & Supply Corporation II Gas Supply Revenue Bonds, Series 2007A & 2007B
• California Statewide Communities Development Authority Gas Supply Revenue Bonds, Series 2010
• Municipal Energy Acquisition Corp. Gas Revenue Bonds, Series 2006A & 2006B
• Indiana Bond Bank Gas Revenue Bonds, 2007
• Northern California Gas Authority No. 1 Gas Project Revenue Bonds, Series 2007A & 2007B
• Main Street Natural Gas Inc. Gas Project Revenue Bonds, Series 2006A & 2006B
• Roseville Natural Gas Financing Authority, CA Gas Prepayment Revenue Bonds, Series 2007A
• Public Authority for Colorado Energy Natural Gas Purchase Revenue Bonds, Series 2008
• Main Street Natural Gas Inc. Gas Project Revenue Bonds, Series 2007A
• Long Beach Bond Finance Authority Natural Gas Purchase Revenue Bonds, Series 2007A & 2007B
• Natural Gas Acquisition Corporation of the City of Clarksville, TN Gas Revenue Bonds, Series 2006
• Texas Municipal Gas Acquisition & Supply Corporation I, Gas Supply Revenue Bonds, Series 2006A & 2006B
• Texas Municipal Gas Acquisition & Supply Corporation I, Gas Supply Revenue Bonds, Series 2008D
• Black Belt Energy Gas District Gas Project Revenue Bonds, Series 2012A
• Central Plains Energy Project Gas Project Revenue Bonds (Project No. 3), Series 2012

According to stock fraud lawyers, the profitability and yield of investor holdings may be impacted by the downgrades placed on these investments. Furthermore, if the gas supplier guarantor’s credit risk was not disclosed, or if the bonds were recommended as “safe,” investors 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 The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.

According to FINRA’s allegations, Fidelity Investments Institutional Services Co. Inc. and Fidelity Brokerage Services LLC, two Fidelity broker-dealers, failed to provide adequate supervisory procedures and produced misleading advertising and sales materials for the fund. Apparently when the subprime crisis unfolded, the fund began losing value in June 2007, but the sales materials for Fidelity continued to purport fixed-income securities of “high credit quality” being held by the fund. The fund’s net asset value fell to $8.25 per share by April 2008, from $10 per share before June 2007, according to investment fraud lawyers.

In a separate ruling in May, a settlement was approved by a federal court in a class action filed against Fidelity units in 2008. In that settlement, Fidelity paid $7.5 million to investors of the bond fund. The Charles Schwab Corp. settled a similar case last year in which they paid almost $119 million over its YieldPlus bond fund. A separate class action claim saw Schwab pay another $235 million to investors in 2010. However, stock fraud lawyers believe that not all investors were compensated.

Investors who suffered significant losses as a result of their investment in Charles Schwab’s YieldPlus bond fund and Fidelity’s Ultra Short Bond Fund, but chose to opt out of the class actions, could still recover their losses through securities arbitration. If you are one of these investors, find out more about your legal rights and options. Contact an investment fraud lawyer at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.

According to the panel’s findings, from July 2005 through July 2007, Kline and Tuberville made intentional fraudulent misrepresentations and omissions regarding the risks associated with CMOs. The affected customers were all retired investors seeking an alternative to equity investments that was safer. Despite the fact that the negative effects that increasing interest rates were having on the CMOs by 2005 were evident to Kline and Tuberville, they failed to explain these conditions to their customers. The clients were instead led to believe that the CMOs were “government-guaranteed bonds” that would generate 10 to 15 percent returns and preserve capital.

For a long time, investment fraud lawyers have been warning investors that retired and elderly investors are often the targets for investment fraud, and this was certainly the case here. Of the seven customers named in the original complaint, all were retired, elderly and/or unsophisticated investors. Furthermore, two were elderly widows who were convinced to put their retirement savings in the risky CMOs and then told that because they were “government-guaranteed bonds,” their money could not be lost. However, in total, the seven investors lost $1,620,100 while Brookstone racked up $492,500 in commissions.

This FINRA ruling concludes charges that were brought in December 2009.

According to investment fraud lawyers, the CMO investments were clearly unsuitable for Kline’s clients. If this case sounds like something that has happened to you, find out more about your legal rights and options by contacting a securities arbitration lawyer at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.

According to securities arbitration lawyers, A & O marketed bonds that were sold as fixed-maturity investments. Furthermore, investors who purchased the bonds were guaranteed annual returns at a minimum of 10 or 12 percent. The scheme claimed the investments were safe and had been designed to grow retirement assets. However, the targets of the fraud, retired and older individuals, were not made aware of the risks associated with the bonds.

While direct claims against A & O cannot be made easily because the company is currently in receivership, investors who purchased the products through a broker may be able to hold that broker responsible if he or she did not adequately explain the investment’s risks. According to investment fraud lawyers, prior to recommending an investment to a client, brokers and firms are required to perform the necessary due diligence to establish whether or not the investment is suitable for the client given their age, investment objectives and risk tolerance. This investment was clearly unsuitable for many of the investors who received the recommendation to purchase the bond.

If you were unsuitably recommended the A & O bond, you may be able to recover your losses through securities arbitration. To find out more about your legal rights and options, contact a securities arbitration lawyer at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.

According to securities arbitration lawyers, approximately $18 million in promissory notes were issued by RMC Medstone Capital and owners of these promissory notes should be seeking recovery of their losses. Prior to recommending an investment to a client, brokers and firms are required to perform the necessary due diligence to establish whether the investment is suitable for the client given their age, investment objectives and risk tolerance. Brokerage firms and broker-dealers offering the RMC Medstone Capital promissory notes will most likely be unable to demonstrate that the necessary due diligence was performed, based on what attorneys know about the investment.

Specifically, investment fraud lawyers are investigating recovery options for investors who suffered losses in RMC Medstone Capital V and VI promissory notes. Both of these notes were apparently sold under the Regulation D private offerings exemption. This exemption applies to certain private offerings and exempts the investment from normal SEC filing requirements.

According to securities arbitration lawyers, Regulation D can make the sale of unsuitable investments to the public easier. Investments sold under Reg D typically pay the selling broker a higher commission than mutual bonds that are not. Therefore, advisers who care more about maximizing commissions than serving their clients’ best interests are attracted to these types of investments.

If you suffered losses as a result of your investment in RMC Medstone Capital promissory notes, you may have a valid FINRA arbitration claim. To find out more about your legal rights and options, contact a securities arbitration lawyer at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.