FINRA Press Release: Non-Traded REITs
(May 2011)
FINRA Charges David Lerner & Associates Over Sale of Non-traded Apple REITs
The Financial Industry Regulatory Authority (FINRA) issued a press release yesterday in which it announced that it had
"filed a complaint against David Lerner & Associates, Inc. (DLA), of Syosset, NY, charging the firm with soliciting investors to purchase shares in Apple REIT Ten, a non-traded $2 billion Real Estate Investment Trust (REIT), without conducting a reasonable investigation to determine whether...
FINRA Press Release: Subprime Securitizations
(May 2011)
FINRA Fines Credit Suisse Securities $4.5 Million and Merrill Lynch $3 Million for Misrepresentations Related to Subprime Securitizations
The Financial Industry Regulatory Authority (FINRA) issued a press release today announcing that
"it has fined Credit Suisse Securities (USA) LLC $4.5 million, and Merrill Lynch $3 million for misrepresenting delinquency data and inadequate supervision in connection with the issuance of residential subprime mortgage securitizations...
SLCG Research: Oppenheimer Champion Income Fund
(May 2011)
SLCG released today 'Oppenheimer Champion Income Fund'.
Oppenheimer's Champion Income Fund (the Fund) was an open-end mutual fund that invested in high-yield bonds. It lost 80% in the second half of 2008, the highest loss for a mutual fund in Morningstar's high-yield bond fund category.
In this paper, we look at the portfolio management rules and decisions of the Fund in the context of what was happening in the markets. Leverage using debt to fund further investments was prohibited by...
FINRA Press Release: Auction Rate Securities
(Apr 2011)
FINRA Fines Jefferies $1.5 Million for Failing to Disclose Additional Compensation Paid and Conflicts in Sale of Auction Rate Securities
The Financial Industry Regulatory Authority (FINRA) issued a press release today announcing that
"it has fined Jefferies & Company, Inc. $1.5 million for failing to disclose additional compensation received and conflicts in connection with the sale of auction rate securities (ARS). FINRA also ordered Jefferies to repay $425,000 in fees and...
SEC Press Release: Mortgage Backed Securities
(Apr 2011)
SEC Announces Securities Laws Violations by Wachovia Involving Mortgage-Backed Securities
The Securities and Exchange Commission (SEC) issued a press release today announcing that
"Wells Fargo Securities LLC [had] agreed to settle charges that Wachovia Capital Markets LLC engaged in misconduct in the sale of two collateralized debt obligations (CDOs) tied to the performance of residential mortgage-backed securities as the U.S. housing market was beginning to show signs of distress...
SEC Press Release: Hedge Fund Fraud
(Mar 2011)
SEC Charges Hedge Fund Managers with Fraud
The U.S. Securities and Exchange Commission (SEC) issued a press release today announcing that it had
"charged a hedge fund investment advisory firm and its two founders with orchestrating a multi-faceted scheme to defraud clients and failing to comply with fiduciary obligations."
The founders, Verzili and Rodriguez of Juno Mother Earth Asset Management LLC allegedly misappropriated client assets by using these assets for the fund's...
SEC Press Release: Life Settlement Fund Fraud
(Mar 2011)
SEC Charges Former UBS Financial Adviser With Defrauding Life Settlement Fund Investors
The U.S. Securities and Exchange Commission (SEC) issued a press release today announcing that they
"charged a former financial adviser at UBS Financial Services LLC with misappropriating $3.3 million in a scheme that included bilking investors in a private investment fund he established."
Kobayashi of UBS, Walnut Creek office, California, established Life Settlement Partners LLC, a pooled...
FINRA Press Release: Improper Marketing
(Jan 2011)
FINRA Orders Schwab to Pay $18 Million to Investors for Improper Marketing of YieldPlus Bond Fund
The Financial Industry Regulatory Authority (FINRA) issued a press release today announcing that
"it has ordered Charles Schwab & Company, Inc., to pay $18 million into a Fair Fund to be established by the Securities and Exchange Commission (SEC) to repay investors in YieldPlus, an ultra short-term bond fund managed by Schwab's affiliate, Charles Schwab Investment Management. The $18...
SEC Press Release: Municipal Bond Fund
(Jan 2011)
SEC Charges Former Portfolio Managers With Defrauding Utah Municipal Bond Fund
The U.S. Securities and Exchange Commission (SEC) issued a press release today announcing that it had
"charged two former portfolio managers with defrauding a mutual fund that invests primarily in municipal bonds issued by the State of Utah and its county and local authorities."
Young and Albright - co-portfolio managers of the Tax Free Fund for Utah at the time - charged municipal bond issuers over...
SLCG Research: Futures-Based Commodity ETFs
(Jan 2011)
SLCG released today a new study about Futures-Based Commodity ETFs. In the past decade the price of commodities has increased substantially and many investors have wanted to diversify their portfolios by including commodities. The most common way to invest in commodities is by buying futures contracts, which requires a good understanding of the pricing of futures contract and specific features of the futures market.
In the past few years we have seen many firms offer Commodity Exchange...
