The Wolper Law Firm Has Filed An Arbitration Claim Against First Allied Securities, Inc. Regarding The Improper Sale Of Sears Bonds And Preferred Stock And A Speculative Penny Stock
In March 2019, the Wolper Law Firm, P.A. filed an arbitration claim against First Allied Securities, Inc. before the Financial Industry Regulatory Authority (FINRA). The arbitration relates to alleged sales practice misconduct committed by First Allied Securities Financial Advisor, Jeffrey Bahary, who is located in the Eatontown, NJ branch office. The Statement of Claim seeks damages of between $250,000-$500,000 and relates to the unsuitable recommendation that the client, invest in corporate bonds and preferred stocks issued by the failed retailer, Sears Holdings Corp., and a speculative penny stock, Odyssey Marine Exploration, Inc. (“OMEX”). As Sears became more financially unstable, it is alleged that Mr. Bahary continued to recommend that the client purchase and/or hold the Sears bonds and preferred stock.
The Statement of Claim alleges:
This case is about an investor who put his faith and trust in his Financial Advisor (“FA”), Jeffrey Bahary, and brokerage firm, First Allied, both of whom had a fiduciary duty to recommend appropriate and suitable investments to meet Claimant’s stated income needs. FA Bahary and First Allied breached that duty by recommending over-concentrated and unsuitable positions in a volatile and speculative underwater salvage company, Odyssey Marine Exploration Inc. (“OMEX”), and preferred stocks and bonds issued by the dying retailer, Sears Holdings Corp (“Sears”). FA Bahary misrepresented the characteristics and risks of the investments, and he and First Allied did nothing to protect Claimant as both OMEX and Sears experienced significant declines, wiping out a large portion of Claimant’s life savings.
Accordingly, for the reasons set forth herein, Claimant seeks an award of compensatory damages in an amount to be determined at the final hearing, but no less than $250,000 and $500,000, plus interest, costs and any such other and further relief as the Panel deems appropriate.
Financial advisors have a legal and regulatory obligation to recommend only suitable investments that are appropriate for their clients’ needs and objectives. Their employing brokerage firm has a legal and regulatory obligation to supervise the Financial Advisors’ sales practices and dealings with clients. To the extent any of these duties are breached, the customer may be entitled to a recovery of his or her investment losses.
The Wolper Law Firm
represents investors nationwide in securities litigation and arbitration on a
contingency fee basis. Matt
Wolper, the Managing Principal of the Wolper Law Firm, is a
trial lawyer who has handled hundreds of securities cases during his career
involving a wide range of products, strategies and securities. Prior to representing investors, he was a
partner with a national law firm, where he represented some of the largest
banks and brokerage firms in the world in securities matters. We can be reached at 800.931.8452 or by email
 Claimant has alleged damages between $250,000 and $500,000 in order to comply with FINRA rules. He will provide the Panel with a precise assessment of damages at the final evidentiary hearing.