Goodman & Nekvasil, P.A. Law Office Announces a $204,867.98 FINRA Arbitration Award Against Legend Securities, Inc., a New York Broker-Dealer

Clearwater, Florida, UNITED STATES


TAMPA, Fla., May 27, 2016 (GLOBE NEWSWIRE) -- Goodman & Nekvasil, P.A., announces they have won a FINRA arbitration award against Legend Securities, Inc. ("Legend") on behalf of a U.S. postal worker in Arlington, Texas, and a Bermuda retiree. Martin S. Brewer and Richard A. Weber alleged that they were defrauded by Richard Gomez ("Gomez"), a Legend representative who recommended in 2011 that they invest in the Praetorian Fund, a fraudulent Ponzi scheme, and U.S. Coal Corporation, an unregistered security.

These investors alleged that Legend negligently supervised Gomez. The evidence at the arbitration hearing showed that Gomez had been employed by 14 brokerage firms in little more than 8 years before joining Legend, that he stopped showing up at the office within a short period after he was hired, that Gomez had minimal production, and that Legend failed to comply with its supervisory procedures over Gomez. Witnesses identified by Legend as Gomez's direct supervisors disclaimed direct supervisory responsibility for him at the hearing.

After a week-long hearing on May 2 - May 6, 2016, a Tampa, Florida, arbitration panel agreed with these investors, finding Legend liable for "negligence." The panel awarded Brewer and Weber their out-of-pocket losses of $79,653.32 and $70,722.66, respectively, and tacked on prejudgment interest of $26,946.83 for Brewer and $16,886.25 for Weber. The panel also awarded $5,000 in sanctions for Legend's violation of panel discovery orders, and $5,658.92 in costs.  Legend was also ordered to pay $14,062.50 in hearing session fees to FINRA.

"This award shows that brokerage firms must aggressively supervise their agents," said Kalju Nekvasil, Esq., of Goodman & Nekvasil, P.A. According to Nekvasil, the claimants' Clearwater, Florida, attorney, brokerage firms cannot disclaim responsibility for their representatives' misconduct just because the representative did not divulge his actions to the firm. "FINRA has long rejected this 'supervision by exception' argument," says Nekvasil.

 


        

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