CHICAGO, June 8, 2012 (GLOBE NEWSWIRE) -- Stoltmann Law Offices announces it has won a FINRA arbitration case on behalf of a Linsco Private Ledger (LPL) client. The investor sustained losses because of investments made in a bogus real estate Individual Retirement Account in a "selling away" scheme.
The case involved former LPL representative Amrita Holden who solicited the Claimant to invest in an alleged real estate deal in Oklahoma in the summer of 2008. In order to facilitate this purchase, the investor was told to take money out of his LPL IRA and transfer it to a "real estate IRA." The investor was promised a 15% annual return and was given a document purporting to show a 25% interest in a building in Stillwater, Oklahoma called Fox Run Apartments. Eventually, the investor suffered a complete loss on his investment. In addition, the investor had funds stolen from his account but eventually the funds were returned. According to her CRD, the LPL advisor was terminated "for cause for violation of LPL policies and procedures relative to client signatures and improper access and use of client funds and for alleged involvement in misappropriation of client funds." Ms. Holden also was named as a defendant in at least seven lawsuits and has had at least five tax liens filed against her. In addition, she had filed for bankruptcy at least twice since 1998. Stoltmann Law Offices is representing multiple clients in FINRA arbitration claims against LPL for her actions.
The Claimant requested the panel award $141,500 along with attorney fees, interest and punitive damages. The panel awarded $141,500 to the Claimant. The award was released this week and the FINRA case number is 11-01036.
According to Chicago attorney Andrew Stoltmann, who argued the case in Los Angeles: "The case was primarily about LPL's supervision, or lack thereof of Ms. Holden. Unfortunately, LPL's supervision was horrific. The firm and its supervisors missed over a dozen supervisory red flags of the misconduct. The firm took an approach of burying its head in the sand and looking the other way when the firms' clients were being defrauded. Had LPL reasonably supervised its financial advisor, as it is required to do under FINRA's Conduct Rules, the 'selling away' scheme would have been stopped as soon as it started. We have represented at least 50 clients of LPL in cases involving ponzi and theft schemes, selling away, unsuitable investment recommendations, unauthorized trading, front running and other nefarious conduct in the past. We are pleased to win another case against LPL where the supervision of its representative was the primary issue."
According to co-counsel David Neuman of Stoltmann Law Offices, who also argued the case: "Brokerage firms must carefully supervise the activities of its financial advisors. These obligations cannot be taken lightly. It is often in the absence of diligent supervision that these scams flourish."
The individuals who testified at the arbitration hearing during the Claimant's case included LPL employees and designated principals Molly E. McKibben and Julie A. Snead, along with LPL auditor Ken Mimoto and LPL attorney James Vannah. The investor's expert witness was Brian Lenart. LPL's expert witness was John Maine.
According to Stoltmann: "Other clients of LPL who have sustained investment losses, had money stolen or converted by LPL brokers, received unsuitable investment recommendations or invested in illiquid, non-traded REITs like Inland Western are encouraged to call Stoltmann Law Offices and discuss their legal rights with an attorney. We handle these cases on a contingency fee basis. We anticipate filing additional arbitration claims in the near future against LPL, and we encourage other victims to contact us to discuss their legal options with no obligation or cost."