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Lawsuit Alleges Securities Fraud December 27, 2010

Posted by jefhenninger in News.

 A lawsuit filed against two securities brokers alleges the two were involved in securities fraud.  According to reports, the securities investment fraud cost customers approximately $8 million. Securities fraud litigation filed by the Securities and Exchange Commission (SEC), alleges at least 40 clients were defrauded by the securities fraud.  According to the Charlotte Observer (12/17/10), the two securities brokers promised their clients there was no way they would lose their principal (big warning) and further told the clients they could get returns of 35 percent (big warning two). The SEC lawsuit alleges that 42 clients, most them elderly, ;ost approximately $8 million when the economy collapsed.

The SEC claims, one broker told an investor that his money was placed in stocks when it was used for options trading. Furthermore, clients were told to sign blank forms which were then used to make one of the broker’s wives the client’s agent and power of attorney for the accounts. In some cases, accounts were set up so clients would not receive statements.

In 2008, both men resigned from Wachovia. According to the SEC, one of the men confessed in his resignation letter to misdirecting $6.6 million from Wachovia customers and admitted he had conducted online trading without the clients’ authorization. The two brokers are charged with six counts of securities fraud.

It sounds like these guys are in big trouble  You can be sure that criminal charges are around the corner which is often the case in these matters.

Asbury Park Criminal Defense Attorney


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