The Guiliano Law Firm, P.C. has filed a securities arbitration claim before the Financial Industry Regulatory Authority or FINRA, against Next Financial Group, Inc., in connection with the sale of unregistered securities, by its former registered representative, Douglas P. Simanski in violation of the federal securities laws and the Pennsylvania Securities Act of 1972, and for common law fraud, breach of fiduciary duty, the failure to supervise, and the violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Act.
At least until May 2016, Douglas P. Simanski was a registered representative of Next Financial, and was permitted by Next Financial to operate his own “independent” in Altoona Pennsylvania. As more fully set forth herein, in May 2016, Simanski was terminated by Next Financial for selling “customers fictitious investments and converted the funds for his own personal use and benefit.” In June 2016, Simanski was permanently barred by FINRA for the failure to cooperate with its investigation that Simanski had sold his customers unregistered securities and had misappropriated customer funds. See Department of Enforcement v. Douglas Simanski, Enforcement Action No. 2016049621301 (June 10, 2016).
Next Financial Group, Inc. is a registered securities broker-dealer with its principal place of business at 2500 Wilcrest Drive, Suite 620, Houston, Texas 77042. Next Financial, with approximately 800 registered representative operating from approximately 518 geographically dispersed branch offices, purports to be one of the fastest growing “independent” brokerage firms in America.
According to the Statement of Claim, Next Financial is responsible for the supervision of Simanski’s conduct and business activities, and the activities conducted at its “independent” branch offices to reasonably detect and prevent the misconduct complained of therein. Courts and securities arbitration panels, in identical circumstances, have long held brokerage firms responsible for the conduct of their registered representatives in “selling away” cases based upon the broker-dealer’s failure to supervise.
In addition to its liability for the failure to supervise, Next Financial may also be liable for Simanski’s conduct under common law agency principles, including respondeat superior, and as a “control person” pursuant to both Section 20(a) of the Exchange Act of 1934, 15 U.S.C. §78(t) and Section 501 of the Pennsylvania Securities Act of 1972, 70 Pa. C.S. § 501.
If you have purchased unregistered or fictitious securities from Douglas P. Simanski, you should consult with a lawyer to determine your legal rights.
Guiliano Law Firm
Our practice is limited to the representation of investors. We accept representation on a contingent fee basis, meaning there is no cost to you unless we make a recovery for you. There is never any charge for a consultation or an evaluation of your claim. For more information, contact us at (877) SEC-ATTY.