Articles Tagged with financial advisor

Patrick Churchville of Rhode Island has been accused of orchestrating a $21 million Ponzi scheme and was recently sentenced to 7 years in prison by a federal judge, according to an Investment News report. Mr. Churchville is thefinancial-fraud-300x200 owner and president of ClearPath Wealth Management and according to SEC’s complaint, he allegedly diverted funds from investors to pay older investors, used their funds as collateral for loans or converted investments to benefit ClearPath Wealth Management. According to the news report, he allegedly used $2.5 million of borrowed money to buy a lavish waterfront home in Rhode Island.

Mr. Churchville started running his Ponzi scheme 2010 onwards and like in any Ponzi scheme, he added to his net worth at the cost of his victims, who lost their homes and all their savings. One of his victims was left on food stamps and needed heating assistance by the end of it, and others were forced back into the workforce in their retirement years. U.S. District Court Chief Judge William E. Smith called the whole scheme a “tragedy”. Churchville allegedly pleaded guilty to five counts of wire fraud and one of tax fraud for failing to pay more than $820,000 in taxes. He has also reportedly been ordered to pay restitution to his 114 victims although the number is unspecified.

Being victimized by financial fraud not only means lost savings but can completely wreak someone’s life and strain personal relationships. At Malecki Law, we regularly help victims of Ponzi scheme get justice and restitution. If you suspect a financial advisor or brokerage firm has been taking advantage of you or your loved ones, reach out for legal advice.

The securities fraud attorneys at Malecki Law are interested in hearing from investors who have complaints against stockbroker Robert E. Heath.  Mr. Heath was previously employed and registered with Presidential Brokerage, Inc. at the broker-dealer’s Colorado Springs, Colorado office, according to his publicly available BrokerCheck records maintained by the Financial Industry Regulatory Authority (FINRA).

Per his BrokerCheck report, Mr. Heath was previously employed and registered by AXA Advisors, LLC from December 2008 to December 2012, and employed by VALIC Investment Services Company from September 1990 to December 2008.

In 2016, Mr. Heath was fined and suspended from association with any FINRA member broker-dealer for three months by FINRA, after submitting a Letter of Acceptance, Waiver and Consent No. 2015046946301 (AWC).  According to the AWC, Mr. Heath violated FINRA Rules 3240 (Borrowing From or Lending to Customers) and 2010 (Standards of Commercial Honor and Principles of Trade) because in July 2012, “while associated with AXA Advisors, Heath borrowed $7,500 from his customer … made one monthly interest payment to [the customer] in August 2012,” even though AXA Advisors prohibited their registered representatives to borrow money from their customers under any circumstances.

This week, it has been reported that the Department of Labor proposed tougher laws after issuing new regulations requiring financial advisors and brokers managing 401k and retirement accounts to act in the best interest of their clients. These rules were proposed a year ago and after deliberating on it for a year, the White House has finalized these tougher requirements. However, it might be a year before these rules go into effect.

An academic study commissioned by the White House revealed that “conflicts of interest” in financial investing was costing Americans about $17 billion a year in retirement savings. Although brokers are required to only recommend “suitable” investments under the current “suitability standard”, they can push a more expensive product that pays a higher commission than a cheaper fund that would be equally appropriate for that investor.

The new rule fiduciary rule is aimed to at reducing fees and commissions that erode retirement savings and hold brokers to higher standards. It will cast a wider net on who is subject to the fiduciary standard.