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The Law Office of Jeffrey M. Haber Investigates potential securities and regulatory violations by 13 investment advisory firms charged with spreading false performance information to their customers

  • Posted on: Sep 19 2016

New York, N.Y.  – September 19, 2016 – The Law Office of Jeffrey M. Haber (the “Firm”) has commenced an investigation into potential securities and regulatory violations by 13 investment advisory firms charged with spreading false performance information to their customers.

On August 25, 2016, the Securities and Exchange Commission (“SEC”) announced that it penalized 13 investment advisory firms (identified below) found to have violated the securities laws by spreading the false claims made by F-Squared Investments (“F-Squared”) – a Massachusetts-based investment management firm –  about its flagship product.

According to the SEC, the 13 firms accepted and negligently relied upon claims by F-Squared that its AlphaSector strategy for investing in exchange-traded funds (“ETFs”) had outperformed the S&P Index for several years.  The firms repeated many of F-Squared’s claims while recommending the investment to their clients without obtaining sufficient documentation to substantiate the information advertised by F-Squared.  In December 2014, F-Squared admitted in an SEC enforcement action that it substantially inflated historical track record information about its AlphaSector product.  F-Squared agreed to pay $35 million to settle the SEC’s charges.

Commenting on the enforcement actions, Andrew J. Ceresney, Director of the SEC Enforcement Division, stated: “When an investment adviser echoes another firm’s performance claims in its own advertisements, it must verify the information first rather than merely accept it as fact. These advisers negligently passed many of F-Squared’s claims onto their own clients, who were consequently relying upon false and misleading information when making investment decisions.”

The following investment advisory firms were penalized by the SEC:

AssetMark, Inc. (F/K/A Genworth Financial Wealth Management, Inc.)

BB&T Securities, LLC

Banyan Partners, LLC

Congress Wealth Management, LLC

Constellation Wealth Advisors LLC

Executive Monetary Management, LLC

HT Partners LLC

J.J.B. Hilliard, W.L. Lyons, LLC

Ladenburg Thalmann Asset Management Inc.

Prospera Financial Services, Inc.

Risk Paradigm Group, LLC

Schneider Downs Wealth Management Advisors, LP

Shamrock Asset Management LLC

Customers who purchased AlphaSector ETFs from any of the foregoing 13 investment advisory firms and have questions about their investments or information relating to this investigation are encouraged to contact The Law Office of Jeffrey M. Haber at (212) 209-1005, or info@jhaberlaw.com.

About the Firm:

The Law Office of Jeffrey M. Haber is dedicated to representing corporations, small businesses, partnerships and individuals involved in a broad range of complex business and commercial litigation matters and violations of the securities laws. The firm combines the sophistication and counsel of a large national law firm with the economy, flexibility, commitment and personal attention of a small firm.

Contact:

The Law Office of Jeffrey M. Haber

708 Third Avenue – 5th Floor

New York, NY 10017

Tel: (212) 209-1005

Fax: (212) 209-7101

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