A recent investigation by the Wall Street Journal revealed that 99.5% of stockbrokers have one or no public disclosures. A “public disclosure” occurs when there is a formal complaint against a broker, arbitration, lawsuit, bankruptcy or criminal complaint. Considering there are over one-half million stockbrokers in this country, the low complaint rates are a testament to the efforts of the industry and regulators to stop fraud before it starts. Although a complaint or public disclosure doesn’t mean a broker shouldn’t get your business, we worry when we see “serial” reportable events.
Currently we are prosecuting cases related to investments in PIWM, Maven, Fidelity Insurance and BC Capital. The SEC and other agencies are pursing cases against the principals in these businesses including Tracy Sunderlage, Nikolai Battoo and Duane Crithfield. In many of cases, we found that the failed investments were sold by stockbrokers.
According to the Financial Industry Regulatory Authority’s free BrokerCheck system, Ellwood Jones has 2 public disclosures including our pending arbitration* case before FINRA involving an alleged loss of $1.9 million. The investment at the center of the case? PIWM.
Dennis Edmonds, formerly of JP Turner and Company, has a relatively clean record. Unfortunately, he has now been identified by several clients who lost millions of dollars in PIWM. We suspect there may be other victims as well.
The good news for investors is that brokerage firms have a duty to supervise their registered representatives. The firm itself can be held financially responsible for the mistakes and violations of their agents. That’s important since many representatives don’t have enough money to satisfy claims against them.
The complaints regarding Dennis Edmonds and Ellwood Jones are still pending. Obviously, no one truly knows all the facts. That means the liability of their former employers for the losses to their customers won’t be known for several more months.
If you have information about Ellwood Jones, Dennis Edmonds or any other broker who you believe is defrauding investors, please contact us. We are interested in determining if any federal, state or industry laws or standards were violated in the marketing of these investments. If so, we may be able to help you get back your hard earned money.
The law firm of Mahany & Ertl specializes in fraud cases against financial professionals including stockbrokers, insurance agents, investment advisers, brokerage firms, accountants and the like. These folks are regulated and required to perform due diligence on the recommendations they make to customers. Brokerage firms are also required to properly supervise their employees and insure they are making suitable recommendations to clients.
If you have lost money in a guaranteed investment contract (GIC), Ponzi scheme or to any investment associated with Battoo / Sunderlage / BC Capital or PIWM, you may have a claim against the person selling you the investment. Although US and foreign enforcement proceedings are underway, there is no guarantee that you will recover any money. In our experience, there rarely is enough money to pay anything close to the actual losses suffered by customers. After the receivers and liquidators receive their fees, there is often little money left for investors.
Post by Brian Mahany, Esq.
Post under Ellwood Jones fraud, Dennis Edmonds fraud
*Many times, arbitration claims are filed against the broker’s present or former employer and not the individual. Until a regulatory body or court takes action, we don’t want to suggest that these individuals have broken any laws. Customers can often recover these funds even if no fraud occurred.