Securities Industry Commentator by Bill Singer Esq

April 19, 2018

FINRA'S BLACK HOLE: In 30 Years, Only 17 Women Won Sexual Harassment Claims Before Wall Street's Oversight Body (The Intercept, by Susan Antilla) 
https://theintercept.com/2018/04/18/in-30-years-only-17-women-won-sexual-harassment-claims-before-wall-streets-oversight-body/
O'Brien's case is one of 98 sexual harassment or hostile work environment claims and counterclaims made by women that The Intercept and the Investigative Fund found in the FINRA database over the past 30 years. FINRA does not categorize the cases in its database, so to assemble our list, we searched for words and phrases including "sexual harassment," "hostile environment," "sex," "sexual," and "harass." Our analysis is based on FINRA arbitration awards, brokers' regulatory records from FINRA and state securities regulators, and court records. FINRA's database includes legacy cases from the authority's two predecessor organizations - the NASD and the New York Stock Exchange - which we refer to here as FINRA cases. On March 14, in response to a request for information about sexual harassment on Wall Street, FINRA turned over a summary of arbitrations from the years 2010 to 2018 to Sen. Elizabeth Warren and two other Democratic senators.

Federal prosecutors alleged that between July 2015 and December 2015, Dwayne C. Hans submitted bids to the Defense Logistics Agency ("DLA") for contracts in the names of two different companies he created, and he was awarded 52 contracts worth about $533,000 on which he was paid about $12,000. In early 2016, Hans created numerous bank accounts in the name of a U.S. financial institution and he then modified payment information for that institution in order to redirect about $1.52 million payments a U.S. government agency intended to transfer to that institution but his actions were detected before he could withdraw/transfer said funds. Hans also caused the electronic transfer of about $134,000 from two corporate bank accounts at the institution and used the proceeds to purchase stock, invest in real estate, and pay utility bills. Finally, Hans fraudulently attempted to secure $1.6 million from the Pension Benefit Guaranty Corporation in the form of bogus expenses for three pension plans that did not exist and had no such reimbursable expenses. Hans pled guilty in the United States District Court for the Eastern District of New York to one count each of wire fraud and computer intrusion and was sentenced to 36 months' imprisonment and ordered to pay $134,000.00 in restitution.

(BrokeAndBroker.com Blog)
http://www.brokeandbroker.com/3930/finra-expungement-ars/
Not being particularly fond of the times that I live in, I am a student of Ancient Greek and Ancient Roman history. In presenting today's BrokeAndBroker.com Blog's coverage of a FINRA expungement arbitration, I am reminded of the Battle of Asculum, during which Pyrrhus of Greece defeated the Roman army. As far as defeats go, this was a lopsided on in which Pyrrhus sustained about half the losses of his enemy; however, his losses were still substantial and many of his field commanders were killed. As is famously ascribed to Pyrrhus ""If we are victorious in one more battle with the Romans, we shall be utterly ruined."

Fast forward about 2,300 or so years and we leave the bloody field of Asculum and arrive at the more sedate setting of a FINRA arbitration hearing room. After the stockbroker Claimant and two of his former firms do battle, the Claimant emerges with a victory that is Pyrrhic in nature. He won the recommended expungment of a customer complaint. Unfortunately, he lost the sought expungement of a second customer complaint and that lack of redress may not be permanently etched into his industry record -- what was once written in pencil now takes on the appearance of being carved in stone. 

SEC Charges Businessman with Stealing Millions from a Pension Plan (SEC Litigation Release No. 24116)
https://www.sec.gov/litigation/litreleases/2018/lr24116.htm
The SEC filed a complaint in the United States District Court for the Western District of Tennessee charging John S Jumper with stealing millions of dollars from Snow Shoe Refractories, LLC's pension plan through the use of forged documents, including fake Board of Directors resolutions. Jumper diverted the allegedly stolen funds, in part, to repay personal debts and, to invest in another business that paid a significant fee to a broker-dealer that Jumper co-owned. Relief Defendants Alluvion Securities, LLC, American Investments Fund II, LLC, Speedee Brakes, LLC, Thousand Hills Capital, LLC and Evertone Records, LLC were named for the purpose of recovering stolen pension funds allegedly in their possession. Criminal charges were filed in the United States District Court for the Middle District of Pennsylvania in a parallel proceeding. READ the FULL TEXT SEC Complaint https://www.sec.gov/litigation/complaints/2018/comp24116.pdf