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FINRA August 2015 Disciplinary Actions: Part I

Dempsey Lord Smith, LLC and Jerry Eskel Dempsey, Jr. of Rome, Georgia submitted a letter of acceptance, waiver and consent ("AWC") in which the firm was censured and fined $10,000. Dempsey is joint and severally liable for half of that with the firm. Similarly, Dempsey was fined $10,000, half of which the firm is joint and severally liable for with Dempsey. According to FINRA, the firm through Dempsey, its CEO and Financial and Operations Principal, failed to establish a proper escrow account for the maintenance of investor funds relating to numerous securities offerings, despite the fact the firm participated in all of the offerings and received customer funds. Rather, the firm let investor funds become commingled in lawyer escrow accounts the issuers had set up. Dempsey allegedly sent emails to potential investors in relation to solicitations to sell bonds issued by an affiliate of the firm that had promissory statements that were not fair and balanced. The firm also failed [...]

By |September 15th, 2015|FINRA, Press Releases & News, SEC|
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SEC Alleges California Men Ran Religious Scam

The Securities and Exchange Commission announced fraud charges and an asset freeze to stop a continuing real estate investment scheme operated by three California businessmen, who allegedly stole investor funds after guaranteeing them "indestructible wealth." The SEC claims that Paul Ricky Mata, David Kayatta, and Mario Pincheira took investor cash to use as their own and also moved a portion of the cash to other businesses they owned. The group acquired over $14 million from more than a hundred investors from California as well as outside the state for two unregistered funds purportedly investing in real estate. Mata posted videos on his website and YouTube to recruit investors to investment seminars called "Finances God's Way" or "Indestructible Wealth." At the seminars, the group urged the crowd to sell the securities they held at the time and invest in their funds, which promised high returns. In actuality, the funds were never profitable. According to the SEC's complaint, a website operated by [...]

By |September 14th, 2015|Fraud, Press Releases & News, SEC|
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New York Global Group CEO Charged With Securities Fraud

Benjamin Wey, a well-known Wall Street financier who assisted many Chinese companies in accessing U.S. markets through reverse mergers, was arrested this week and charged with altering the companies' shares to allegedly earn himself tens of millions of dollars in illicit gains. Wey, the CEO of New York Global Group, now has criminal and civil cases against him. They represent the highest profile cases yet as the government tries to put its foot down during a mass of alleged accounting fraud and other illegalities by small Chinese companies that have gone public in the United States. Allegedly, Wey covertly controlled large portions of the shares of the companies for which he orchestrated reverse mergers and inflated the companies' stock prices while selling the shares he controlled at artificially high levels, according to the Manhattan federal court indictment. The SEC has also brought a civil action against him. According to Manhattan U.S. Attorney Preet Bharara, “Ben Wey fashioned himself a master of industry, but [...]

By |September 11th, 2015|Fraud, Press Releases & News, SEC|
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Alabama Man Sentenced In Securities Fraud Case

Kevin Jerome Brown of Hoover, Alabama is looking at a long probation sentence after pleading guilty to securities fraud, according to authorities. Brown pleaded guilty to one count of securities fraud by employing a device, scheme, or artifice to defraud and one count of acting as an unregistered securities agent in Shelby County Circuit Court on September 3. Both counts are felonies that include sentences from a year and a day to ten years and a $15,000 fine. Judge George Daniel Reeves handed down a seven-year suspended sentence and four years of supervised probation. Brown was further ordered to pay $932,852 in restitution to nine victims by making monthly payments starting October 1. Authorities claim that Brown used investor funds for personal expenses while working as a mortgage broker for The Mortgage Office, LLC and Bluestar Mortgage, LLC in Birmingham. As stated in two grand jury indictments, Brown told people that the two companies could provide mortgages to clients who [...]

By |September 10th, 2015|Fraud, Press Releases & News|
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