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Kentucky Securities Law Blog

MihalekLaw Investigates Municipal Bonds Issued by Ross, Sinclaire, & Associates, Inc. for St. Catharine College

MihalekLaw announces that it is investigating unrated municipal bonds that were sold by Ross, Sinclaire, & Associates ("RSA") of Cincinnati, Ohio. RSA sold over $20,000,000 of municipal bonds that were issued by Springfield, Kentucky for St. Catharine College of St. Catharine, Kentucky. St. Catharine College has been placed in receivership, as these bonds are now in default. 

Securities fraud: It "can happen to anyone"

We do not know yet when the University of Kentucky Wildcats will suit up against the University of Arkansas Razorbacks for a game of basketball, but we can be sure the two SEC rivals will be ready to put on a show.

Former Arkansas football standout was recently in the news regarding significant financial losses that might well include securities fraud, according to media reports. The McFadden losses apparently motivated an Arkansas business publication to print an article on the dangers of financial fraud.

Registered Representative Bert E. Gore

MihalekLaw has initiated investigations concerning excessive markup and markdowns and the churning of community banks' bond portfolios by former Sterne Agee & Leach, Inc. registered representative and principal Bert E. Gore, Jr. (CRD # 501978). Mr. Gore was a licensed as a producing branch manager and principal for Sterne, Agee at its Bernardsville, NJ branch office from 2007 until 2014. He was discharged by Sterne, Agee on October 27, 2014 for "violation of internal policies and procedures, including the failure to disclose outside business activities and litigation and complaints involving those activities." Thereafter, Mr. Gore was registered with Ross, Sinclaire & Associates, LLC from December 2014 until July 2016, and he currently is employed by and registered with Intercoastal Capital Markets, Inc.

Mr. Gore's CRD/Brokercheck Report reflects a customer dispute which involved, among other matters, excessive markups and markdowns while Mr. Gore was employed at Sterne, Agee, which was settled for $3,000,000. The claim also involved allegations that Mr. Gore churned the bank's debt bond portfolio in violation of its Investment Policy Statement. 

Broker charged with churning account of elderly, blind widow

The recent media report on the alleged misdeeds of a broker might establish a new low. The Financial Industry Regulatory Authority Inc. accuses a broker of putting a "deceptive and fraudulent scheme" in which he churned the account of an elderly, blind widow.

The churning scheme generated commissions of $248,000 for the broker over a 3-year period, according to the report. The 77-year-old widow suffered net losses of $184,000, Finra says.

Informant tired of cooperating in securities fraud investigations

Earlier this year, the Department of Justice announced the federal grand jury indictment of a broker-dealer allegedly involved in a "pump and dump" scheme that included Kentucky USA Energy Inc.

The New York broker is accused of securities fraud and conspiracy to commit securities fraud.

Weeding out the bad ones

Regular readers of our Lexington securities fraud blog know that in our previous post, we discussed pump and dump schemes. Pump and dump happens when fraudsters encourage investors to buy shares in a company (often with false and misleading statements) and then dump their shares when the price is high.

Equities.com recently took a look at the case of Jammin' Java Corp. The company purportedly sold coffee products marketed with the name and image of reggae legend Bob Marley. In reality, the company had no real earnings.

Securities fraud, teddy bears and hockey

The Lexington Herald Leader recently reported that a man sentenced to a decade in prison for securities fraud has had his sentence cut in half. Sixty-nine-year-old Paul Greenwood is best known for three things: his crimes, his fascination with teddy bears and the time he spent as part-owner of the New York Islanders hockey team.

The sentence reduction was ordered because, the judge said, Greenwood had long been involved in charity and because 98 to 99 percent of the money invested in his half-billion-dollar swindle had been returned to its rightful owners. 

Ponzi scheme architect headed to prison

The story is one familiar to our regular Lexington readers: early investors received substantial returns. Later investors in the scam were left holding the bag.

The Ponzi scheme that operated out of Orange County, California, has a touch of Hollywood, though: the man at its helm used investor funds to finance a movie about a Mexican Little League team and to purchase an outsized yacht. Joseph Lampariello, the architect of the scheme, was recently sentenced to 121 months in a federal prison.