Tuesday, March 5, 2013
THE RISK OF PUT AND CALL OPTIONS
One of the cardinal rules for managing your retirement / brokerage accounts is to never be talked into an investment if you do not fully understand how it works and the risks involved. Too often I have seen financial advisers put someone’s retirement funds into high-risk investments such as put and call options. These options are investment vehicles that involve the right to buy or sell a specific stock, for a specific price, and for a specific length of time—usually 90 days or less. If not watched closely by your investment adviser, a put or call option can expire worthless, wiping out your entire investment. Options are highly speculative and are not suitable for the average investor. If you have questions concerning put or call options or any other investments, contact Baker & Slaughter.
Tuesday, January 11, 2011
NJ Attorney General Files Suit Against Carr Miller Capital
The Office of the Attorney General of New Jersey and the Bureau of Securities has filed suit against Carr Miller Capital LLC of Marlton and its three principals for their alleged use of a Ponzi scheme and other means to defraud investors of over $40 million.
Everett Charles Ford Miller, 41, president of Carr Miller Capital, and Ryan Jude Carr, 34, and Brian Patrick Carr, 39, cousins and employees of Carr Miller Capital, are named as defendants in the state’s nine-count Complaint. The lawsuit, filed in Superior Court in Newark, alleges that the defendants violated numerous New Jersey Uniform Securities Laws by committing fraud, commingling funds, and selling unregistered securities.
Judge Kenneth Levy on Monday approved the freezing of assets held by Miller and his related companies, and the appointment of a receiver who will oversee and control those assets. The judge also approved the appointment of a fiscal monitor for the Carrs, and one nominal defendant. Their assets cannot be moved or transferred without the approval of the fiscal monitor.
The state’s complaint seeks restitution for investors, disgorgement of profits, and the imposition of civil penalties.
In a related action, the Bureau of Securities has revoked the Investment Advisor registrations and/or exemptions of Carr Miller Capital, Capital Markets Advisory, LLC, Miller, Brian Carr and Ryan Carr, effectively barring them from the state’s securities industry.
“We charge that these defendants operated a Ponzi scheme for their own enrichment at the expense of investors,” Attorney General Paula Dow said. “Instead of investing funds to produce high rates of return as promised, we allege that the defendants spent investors’ hard-earned money on personal luxuries and indulgences.”
As detailed in the first four counts of the state’s Complaint, the defendants made false statements and omitted materials facts when dealing with investors and also deployed invested funds for unauthorized uses.
The Bureau’s investigation revealed that $13.5 million of investors’ monies were used to pay for a New Jersey Devils sky box at the Prudential Center in Newark, personal automobile purchases, travel and luxury vacations, retail purchases and meals, among other things. An additional $16 million was put into various hedge funds, real estate, film production companies, and an oil and gas venture, among other ventures not authorized by or disclosed to investors.
Carr Miller Capital offered nine-month notes that purportedly provided rates of return between 10% and 15% annually. Certain investors were told they could renew the notes for additional nine-month terms or be paid out at the end of the term. Approximately $8 million of the $40 million was sent to investors as “interest” payments, when, in fact, they were merely new investors’ capital being used to keep the Ponzi scheme in operation.
“These defendants operated a classic Ponzi scheme, using funds from new investors to pay money to earlier investors, all in an attempt to perpetuate the deception,” said Thomas R. Calcagni, Acting Director of the Division of Consumer Affairs. “The promised rates of return sounded too good to be true and, sadly, that turned out to be the case.”
The securities offered by the defendants were not registered for sale in New Jersey and Ryan Miller was not registered to act as an agent, as alleged in Counts V and VI of the state’s Complaint.
“Unregistered investments and unregistered individuals should be an immediate red flag to potential investors,” said Marc B. Minor, chief of the N.J. Bureau of Securities. “The Bureau is a resource that investors can use to perform due diligence as they decide how and with whom to invest.”
If you purchased Carr Miller Capital promissory notes, contact Baker & Slaughter, P.A. at 910-762-3000 for a complementary review of your case and assistance in recovering your investment.
Everett Charles Ford Miller, 41, president of Carr Miller Capital, and Ryan Jude Carr, 34, and Brian Patrick Carr, 39, cousins and employees of Carr Miller Capital, are named as defendants in the state’s nine-count Complaint. The lawsuit, filed in Superior Court in Newark, alleges that the defendants violated numerous New Jersey Uniform Securities Laws by committing fraud, commingling funds, and selling unregistered securities.
Judge Kenneth Levy on Monday approved the freezing of assets held by Miller and his related companies, and the appointment of a receiver who will oversee and control those assets. The judge also approved the appointment of a fiscal monitor for the Carrs, and one nominal defendant. Their assets cannot be moved or transferred without the approval of the fiscal monitor.
The state’s complaint seeks restitution for investors, disgorgement of profits, and the imposition of civil penalties.
In a related action, the Bureau of Securities has revoked the Investment Advisor registrations and/or exemptions of Carr Miller Capital, Capital Markets Advisory, LLC, Miller, Brian Carr and Ryan Carr, effectively barring them from the state’s securities industry.
“We charge that these defendants operated a Ponzi scheme for their own enrichment at the expense of investors,” Attorney General Paula Dow said. “Instead of investing funds to produce high rates of return as promised, we allege that the defendants spent investors’ hard-earned money on personal luxuries and indulgences.”
As detailed in the first four counts of the state’s Complaint, the defendants made false statements and omitted materials facts when dealing with investors and also deployed invested funds for unauthorized uses.
The Bureau’s investigation revealed that $13.5 million of investors’ monies were used to pay for a New Jersey Devils sky box at the Prudential Center in Newark, personal automobile purchases, travel and luxury vacations, retail purchases and meals, among other things. An additional $16 million was put into various hedge funds, real estate, film production companies, and an oil and gas venture, among other ventures not authorized by or disclosed to investors.
Carr Miller Capital offered nine-month notes that purportedly provided rates of return between 10% and 15% annually. Certain investors were told they could renew the notes for additional nine-month terms or be paid out at the end of the term. Approximately $8 million of the $40 million was sent to investors as “interest” payments, when, in fact, they were merely new investors’ capital being used to keep the Ponzi scheme in operation.
“These defendants operated a classic Ponzi scheme, using funds from new investors to pay money to earlier investors, all in an attempt to perpetuate the deception,” said Thomas R. Calcagni, Acting Director of the Division of Consumer Affairs. “The promised rates of return sounded too good to be true and, sadly, that turned out to be the case.”
The securities offered by the defendants were not registered for sale in New Jersey and Ryan Miller was not registered to act as an agent, as alleged in Counts V and VI of the state’s Complaint.
“Unregistered investments and unregistered individuals should be an immediate red flag to potential investors,” said Marc B. Minor, chief of the N.J. Bureau of Securities. “The Bureau is a resource that investors can use to perform due diligence as they decide how and with whom to invest.”
If you purchased Carr Miller Capital promissory notes, contact Baker & Slaughter, P.A. at 910-762-3000 for a complementary review of your case and assistance in recovering your investment.
Thursday, February 25, 2010
Free Lunch Seminar
The most expensive meal that you will ever have is the free lunch provided at the seminar sponsored by so-called expert estate planners. Usually, the seminar focuses on the benefits of a living trust versus the standard will. The financial planner will bring out horror stories concerning the estates of famous people where there was exorbitant costs involved with the probate of the estate. They fail to mention that the costs were related to fights among the children of the various surviving spouses which would be the same whether there is a living trust or not. The estate planner relishes in lawyer bashing wanting you to believe that the main person you should fear in life is the attorney who helps probate your will.
After the investment seminar, the financial planner, who is actually an insurance agent, uses the living trust sale to discover the financial information of his new client. Once a boiler plate living trust has been executed, then the estate planner pushes for the sale of insurance and annuity contracts which provide lucrative commissions.
The attorney general’s offices in numerous states have issued warnings concerning these “living trust mills” and encourage consumers to contact a qualified attorney and/or certified public accountant before buying into the value and suitability of a living trust for that individual.
If you have further questions or comments concerning the free lunch seminar, please contact us.
After the investment seminar, the financial planner, who is actually an insurance agent, uses the living trust sale to discover the financial information of his new client. Once a boiler plate living trust has been executed, then the estate planner pushes for the sale of insurance and annuity contracts which provide lucrative commissions.
The attorney general’s offices in numerous states have issued warnings concerning these “living trust mills” and encourage consumers to contact a qualified attorney and/or certified public accountant before buying into the value and suitability of a living trust for that individual.
If you have further questions or comments concerning the free lunch seminar, please contact us.
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