Case Results

CASE NO. 15-03264

FINRA panel awards nearly 100% of investor’s capital losses and fees

Jose Pastrana v. UBS Financial Services, Inc. and UBS Financial Services of Puerto Rico, Inc. Erez Law represented an investor that sustained significant losses primarily in proprietary UBS closed-end funds invested in Puerto Rico bonds. The financial advisor was Alexandra Amador who had herself sued UBS for misleading her in regards to the same funds. The Claimant alleged that UBS recommended an unsuitable and over-concentrated investment in high risk Puerto Rico funds. The FINRA panel awarded compensatory damages in the amount of $435,623, costs of $26,936, attorney’s fees of $102,000 and rescission of the current illiquid fund holdings. The Award is significant in that it represents nearly 100% of the investors’ capital losses, plus costs, attorney’s fees and rescission.

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SETTLEMENT

Recovered $635,000 from a major brokerage firm

Recovered $635,000 from a major brokerage firm for a client who lost money investing in Puerto Rico bonds using an extensive level margin. Erez Law brought claims based upon the unsuitability of the investments, misrepresentations and failure to make adequate disclosures, amongst other things. The arbitration case was filed with FINRA Dispute Resolution and was settled very close to the start of the trial date.

CASE NO. 10-04056

Donald A. Hausfeld and Judith A. Hausfeld v. Morgan Keegan & Company, Inc.

Erez Law recovered a total of $522,873 inclusive of interest, attorneys’ fees and costs against Morgan Keegan in connection with its sale of the RMK Advantage Income Fund. The panel awarded attorneys’ fees based upon a finding that Morgan Keegan violated the Georgia Securities Act. Notably, the panel awarded interest from November 2004, when our client made their investment in the RMK Fund through the date of the final hearing in April 2012.

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CASE NO. 08-01333

Phillip Richardson v. Morgan Keegan & Co.(FINRA)

The Firm obtained a $430,000 verdict against Morgan Keegan, in a case alleging securities fraud over the sale of Morgan Keegan open-end mutual funds, known as RMK Select High Income (MKHIX), RMK Select Intermediate Fund. The verdict represented 126% of the net out of pocket losses.

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SETTLEMENT

Recovered $375,000 for selling away

Recovered $375,000 from a brokerage firm for a client who sustained losses when his broker recommended and implemented unapproved futures trading. This type of wrongful conduct by a broker is called “selling away.” The settlement amount represented a high percentage of the client’s losses. Erez Law brought claims based upon the unsuitability of the investment, misrepresentations, and failure to supervise, amongst other things. The case was filed with FINRA Dispute Resolution and was settled close to the start of the trial date.

CASE NO. 10-03532

Russell Stephen Tarrant v. Kovack Securities, Inc.

The Firm obtained total damages of $314,317 for an investor who lost $100,000 when the broker engaged in “selling away”. Selling away occurs when a broker sells an unapproved investment to his customer. The arbitrators awarded the extraordinary relied of punitive damages due to the “egregious behavior on the part of the broker and the apparent lack of any system of supervision” by Kovack Securities.

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CASE NO. 11-04247

Scott Stephens, as Trustee of the Wilbert Joseph Stephens, Jr. Testamentary Trust #1 et al. v. Morgan Keegan & Company, Inc.

Erez Law recovered $290,999 for investors who sustained losses in the closed-end RMK bond funds managed by James Kelsoe. The award is significant in that it represents a recovery of 100% of the investors’ losses. The investors filed claims based upon the unsuitability of the investments as well as misrepresentations and omissions in connection with the RMK Funds. The brokerage firm denied liability and contended that the investors wanted high risk investments, that the risks were disclosed and that the investors should have sold immediately when the funds declined in value. The arbitrators unanimously rejected the brokerage firms’ arguments and found for the investors.

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CASE NO. 08-00574

Humphries v. Morgan Keegan & Co.

Humphries v. Morgan Keegan & Co. (FINRA). The Firm obtained a $286,000 verdict against Morgan Keegan, in a case alleging securities fraud over the sale of a Morgan Keegan open-end mutual fund, known as the RMK Select Intermediate Fund. The verdict including a finding that Morgan Keegan violated the Mississippi Securities Act and represented a recovery of all net out-of-pocket losses, interest, and attorneys fees and costs.

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SETTLEMENT

Recovered $250,000 for an investor against a brokerage firm

Recovered $250,000 for an investor against a brokerage firm related to losses in real estate investment trusts (“REITs), and other real estate related private investment funds. Erez Law brought claims based upon the unsuitability of the investments, misrepresentations and failure to make adequate disclosures, amongst other things. The arbitration case was filed with FINRA Dispute Resolution and was settled very close to the start of the trial date.

CASE NO. 10-02971

John Murphy v. Citigroup Global Markets Case

Erez Law recovered $250,000 for an investor who purchased $250,000 of Fannie Mae preferred Series T in the public offering in May 2008. A Citigroup/Smith Barney broker sold the preferred shares to John Murphy, a retiree living in South Florida and four months later the US Government put the company in conservatorship and the investment was rendered virtually worthless. Mr. Murphy’s out of pocket losses were $230,000. The Panel awarded in excess of out of pocket which is a rarity. The Panel also made a specific finding that the broker violated the fiduciary duties owed to Mr. Murphy.

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