Riverstone Wealth Management Stockbroker Barred for Defrauding Investors
Stockbroker J. Michael Casas was barred by Financial Industry Regulatory Authority (FINRA) in any and all capacities and ordered to pay restitution in connection with an Extended Hearing Panel Decision containing findings that Casas had fraudulently sold securities issued by his company on the basis of false statements of material fact and that Casas converted investor funds for his own personal use. Department of Enforcement v. Casas, No. 2013036799501 (Oct. 2, 2015).
According to the Decision, Casas had induced two investors to invest $83,000 in a company which Casas had owned and controlled called MCB Capital Partners, LLC. The Decision stated that the funds were supposed to be used for the development and execution of reverse merger transactions, but that such transactions never actually took place. The Decision indicated that the investors were solicited from January, 2012 – September, 2012, where Casas had made material misrepresentations concerning usage of investor funds. FINRA found that Casas had converted most of the customers’ funds in order to pay Casas’ personal expenses.
As a result of Casas’ conduct, FINRA charged Casas with violating Section 10(b) of the Securities Exchange Act of 1934, Rule10b-4, and FINRA Rules 2010 and 2020, along with advancing a claim for conversion of customer funds in violation of Rule 2010. The Extended Hearing Panel determined that FINRA’s Department of Enforcement had proven, by a preponderance of the evidence, that Casas was liable for his actions.
Section 10(b) of the Exchange Act makes it unlawful “to use or employ, in connection with the purchase or sale of any security registered on a national securities exchange or any security not so registered, any manipulative or deceptive device or contrivance in contravention of such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors.”
Four elements are necessary to show in finding a violation of Section 10(b) of the Exchange Act, Rule 10b-5: 1) misrepresentations and/or omissions were made; 2) misrepresentations and/or omissions were material; 3) representations and/or omissions were made with requisite intent (e.g. scienter), and 4) misrepresentations and/or omissions were made in connection with the purchase or sale of securities.
Firms and individuals, not surprisingly, are prohibited from unauthorized use of customer funds, borrowing of a customer’s securities or funds, forgery, non-disclosures or misstatements of material facts, and various deceptions and manipulations. Such conduct can also be found to violate criminal and other civil laws, and be subject to sanction from the federal and state government bodies.
Public disclosure records reveal that Casas has been subject to a pending customer dispute from June 26, 2012, where a customer is requesting $50,000.00 after making a direct investment in MCB Capital Partners, LLC as a minority owner. After the claimant’s alleged demand for a rescission of investment was denied, a claim alleging fraud and misrepresentation ensued.
Guiliano Law Group
If you have been the victim of securities fraud and you have a complaint, you should consult with an attorney. The practice of Nicholas J. Guiliano, Esquire, and The Guiliano Law Group, P.C., is limited to the representation of investors in claims for fraud in connection with the sale of securities, the sale or recommendation of excessively risky or unsuitable securities, breach of fiduciary duty, and the failure to supervise. We accept representation on a contingent fee basis, meaning there is no cost unless we make a recovery for you, and there is never any charge for a consultation or an evaluation of your claim. For more information contact us at (877) SEC-ATTY.