FINRA Bans Penny-Stock Broker Anastasios Belesis

Posted on January 12, 2015 by admin

Brokerdealer.com update courtesy of Bloomberg’s Zeke Faux.

Financial Industry Regulatory Authority (FINRA) has been banned from the brokerage industry forever on Friday.

Anastasios Belesis

, the former head of John Thomas Financial Inc., was barred from the brokerage industry for life by the Financial Industry Regulatory Authority for trading ahead of clients’ orders.

Belesis dumped the New York-based firm’s position in a penny stock that was surging while 14 customers tried and failed to sell their shares, Finra said today in a statement. The industry-funded regulator ordered Belesis to pay about $1 million plus interest to customers and fined him $100,000.

Belesis has appeared on business television and had a minor role in the movie “Wall Street: Money Never Sleeps” before his boiler room across from the New York Stock Exchange closed in 2013. Trainees at the brokerage were forced to stand and bark memorized sales scripts for as long as 14 hours a day, Bloomberg News reported at the time, citing interviews with 20 former employees.

Finra said in the statement today that John Thomas didn’t hold the customer orders intentionally. Ron Cantalupo, a John Thomas broker who was accused of intimidating a colleague, was cleared by the regulator, which also dismissed charges against Michele Misiti and John Ward.

Finra’s fraud charges against Belesis were dismissed as well. He agreed to pay $500,000 in 2013 to settle accusations by the Securities and Exchange Commission that he pressured a hedge-fund manager to steer fees to John Thomas.

“He was never ever charged with running a boiler room,” Ira Sorkin, Belesis’s lawyer at Lowenstein Sandler LLP, said in a telephone interview. “To the extent there were charges brought against him for fraud, they were dismissed.”

For the original article from Bloomberg’s Zeke Faux, click here

Third Time The Charm For Hedge Fund Manager Dreaming of Being NHL Owner

Posted on January 8, 2015January 8, 2015 by admin

Brokerdealer.com update courtesy of FINalternatives.

New Arizona Coyote owner, Andrew Barroway (Left)

After two failed attempts, a managing partner at a hedge fund has finally reached an agreement with the NHL team Arizona Coyotes to become a team owner.

Call it a “Miracle on Ice.”

In his third attempt, hedge-fund manager A

has finally reached an agreement to acquire a majority share of an NHL franchise.

Barroway, a managing partner of Merion Investment Management, now owns 51% of the Arizona Coyotes and is the team’s chairman and governor.

This was the third attempt by Barroway to purchase an NHL team in the last two years. In 2012, a deal with the New Jersey Devils fell through. Last summer, he was certain he’d acquired a majority stake in the New York Islanders, but the team’s owner Charles Wang decided to sell to Jonathan Ledecky and Scott Malkin at the last-minute. This prompted a lawsuit by Barroway against the Islanders owner; however, the case was dropped as the Merion partner began his latest pursuit in Arizona.

Still, it wasn’t easy for Barroway to complete his three-year journey toward NHL ownership. Last month, multiple sources indicated that the deal was in jeopardy on news that Barroway was prepared to back out of a reported $155 deal. The Globe and Mail’s James Mirtle wrote that Barroway’s principle interest in “buying [the team] was to flip it.”

The New York Post reported in the fall that Barroway planned to resell the team to an ownership group that wants to move the team to Las Vegas. That news coincided with a report that NHL committed to a Las Vegas owner’s plan to hold a season-ticket drive to measure possible interest for a team in Nevada.

However, Barroway denied speculation that he would flip the team during an interview with Fox Sports last week.

“I am buying this team because I am a lifelong sports and hockey fan,” Barroway said. “It has always been my dream to become an owner. I want to bring a winner to the Valley. That [report] couldn’t be any more false. I am thrilled to be here and am thrilled to be an owner and would not have gone through this difficult process in buying a team just to go flip it.”

Barroway said he plans on being an active owner while remaining engaged in his day-to-day role at his fund. Merion Investment Management has more than $1 billion in assets under management.

For the original article from FINalternatives, click here.

Ex-Morgan Stanley Brokerdealer Stole and Posted 900 Clients’ Data

Posted on January 7, 2015 by admin

Ex-Morgan Stanley employee Galen Marsh

Brokerdealer.com courtesy of Business Insider’s Julia La Roche and Elena Holodny.

Big name brokerdealer firm Morgan Stanley took a hard hit this week after a now ex-employee stole more than 900 clients’ information and released it online.

Business Insider’s Julia La Roche originally reported on the story on 5 January.

Morgan Stanley said it has fired an employee who had stolen data from 900 of the firm’s wealth management clients.

“While there is no evidence of any economic loss to any client, it has been determined that certain account information of approximately 900 clients, including account names and numbers, was briefly posted on the Internet. Morgan Stanley detected this exposure and the information was promptly removed,” Morgan Stanley said in a statement.

The name of the terminated employee has not been released.

For Morgan Stanley’s original press release, click here.

On 6 January Businesss Insider’s Elena Holodny wrote a follow-up story including a statement from the terminated employee.

The former Morgan Stanley employee who stole data from 900 of the firm’s wealth-management clients and posted it on the internet has come out with a statement.

Galen Marsh is “extremely sorry for his conduct,” his lawyer told Michael J. Moore for Bloomberg Businessweek, insisting that Marsh did not intend to profit off of the act.

“Mr. Marsh did not sell nor ever intend to sell any account information whatsoever,” Marsh’s lawyer told Bloomberg. “He did not post the information online. He did not share any account information with anymore nor use it for any financial gain. He is devastated by what has occurred and is extremely sorry for his conduct.”

He did not say why Marsh stole the data.

Morgan Stanley announced on Monday that the firm fired an employee, Marsh, who stole data from 900 of the firm’s wealth-management clients and then posted it on the Internet.

“While there is no evidence of any economic loss to any client, it has been determined that certain account information of approximately 900 clients, including names and numbers, was briefly posted on the internet,” Morgan Stanley said in a statement.

Information for as many as 350,000 wealth-management clients was stolen, Bloomberg reports. The firm detected account information for 900 of them on an external website.

Ladenburg Thalmann Financial Services Acquire Brokerdealer Firm

Posted on January 6, 2015 by admin

Brokerdealer.com blog update courtesy of South Florida Business Journal’s Nina Lincoff profiles a financial service’s recently acquisition of brokerdealers services.

Brokerdealers are at the center of the securities and derivatives trading process therefore making them a great asset to any financial services firm. Services that brokerdealers offer very important and valuable tools to any financial services firm. Recently, Miami-based Ladenburg Thalmann realized this and made a $45 million venture to acquire the Knoxville, Tennessee-based independent broker-dealer and advisory firm, Securities Service Network.

Miami-based Ladenburg Thalmann Financial Services said Monday it had completed its $45M acquisition of a Knoxville, Tenn.-based independent broker-dealer and advisory firm.

With the acquisition of Securities Service Network, Ladenburg Thalmann adds about $13 billion in client assets and about 450 independent financial advisors, according to a news release. For the 12 months ended June 30, SSN generated about $115 million in revenue.

The acquisition, announced in September, consists of a $25 million cash payment and $20 million in four-year notes. The purchase follows a string of purchases by Ladenburg Thalmann, including a November acquisition of a broker-dealer that added $2.5 billion in assets to the company.

Ladenburg Thalmann’s chairman and principal shareholder is billionaire Dr. Phillip Frost, CEO of Miami-based Opko Health. Frost acquired 100,000 shares of Ladenburg Thalmann stock at nearly $4.09 a share, or a total of just over $400,000, the same day the acquisition was announced.

For Lincoff’s original article in South Florida Business Journal, click here.

IPO Market Recovers, Gives Some Hope to Silicon Valley, But Not Much

Posted on December 31, 2014December 31, 2014 by admin

Brokerdealer.com blog update profiles the recovery of the IPO market and the effects it had on Silicon Valley companies courtesy of Venture Beat’s Chris O’Brien.

Although it was a great year for IPOs, it was not necessarily a good for brokerdealers, as O’Brien explains later on, returns on IPOs in 2014 took a dramatic drop compared to returns on IPOs in 2013. Nonetheless, a strong IPO showing is projected for 2015, which could create big returns for brokerdealers in the New Year. In addition, Silicon Valley has plenty to stress as about as there wasn’t a huge IPO growth made in tech industries, the surge of IPOs came from health and biotech fields.

A tech industry that had spent years waiting for a revived IPO market finally got its wish in 2014.

The overall IPO market reached a level not seen since 2000. And Silicon Valley companies rode that wave as venture-backed IPOs soared, according to year-end data from Renaissance Capital.

Within these ample gold and silver linings, there are a few clouds looming for the tech industry as well.

First, let’s start with the good news. Here are the highlights from Renaissance:

The 273 IPOs in 2014 was the most since 406 IPOs in 2000.
IPOs were up 23 percent over 2013, even though there were some global scares like the Ukraine crisis and Ebola that in years past might have causes stock markets to freak out.
Money raised climbed 55 percent to $85 billion, though Alibaba accounted for $22 billion of that.
The number of venture-backed IPOs climbed to 124 this year, up from just seven in the dark economic year of 2008.
A solid pipeline and strong US economy should mean another strong IPO showing in 2015.

So, what’s there to worry about amid all this rosy news?

1. Returns were down: The boom in the number of IPOs was not necessarily great for investors. Average IPO returns were only 16 percent, a big drop from the 41 percent return on IPOs in 2013. That could put a chill on IPOs in 2015 if the trend continues.

2. Tech is not king: The surge in IPOs was led by healthcare and biotech IPOs. In particular, the overall numbers were padded by the 100 healthcare IPOs in 2014, a jump from 54 the year before. Slice off that healthcare increase, which mainly included a lot of small-cap companies, and the number of IPO offerings was about the same as 2013.

3. 2014 was very good, not great, for tech: There were 55 tech IPOs in 2014, up from 45 the year before. Those IPOs raised $32 billion, though that includes Alibaba’s $22 billion haul. Back that out, and you still have a nice increase from the $7.9 billion raised in 2013. But tech companies are hardly printing money. And talk of a bubble remains just plain silly.

4. China rules: This year will be remembered for the monster Alibaba IPO offering, followed by China’s JD.com offering that raised $1.8 billion. Those were the only two tech companies to make the list of the year’s 10 largest IPOs. And with China’s Internet population more than double that of the U.S., the center of the tech world could continue its shift to Asia.

None of these things should dampen the tech industry’s celebration of a solid year. But they’re a good reminder that Silicon Valley shouldn’t get overconfident when it comes to IPOs and think just any company with a little momentum can go public. Investors can afford to be selective.

And, really, that’s probably a good thing for all of us.

For O’Brien’s original article in Venture Beat, click here