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Written by 2:25 pm Blog, Securities Fraud

SEC charges FTN Financial Securities Corp.

According to a recent article in the SEC recently “charged Memphis, Tenn.-based broker-dealer FTN Financial Securities Corp. for aiding financial advisor firm Sentinel Management Group Inc. in defrauding its clients of an estimated $1.5 milion…” It is alleged that FTN Financial Securities failed to “maintain accurate books and records of Sentinel’s securities transaction liabilities in its 2006 financial statements.”

FTN has been charged and implicated in Sentinel’s fraud because the SEC says that the inaccurate books and records were used by Sentinel to defraud clients. The SEC alleges that around the end of 2006 and beginning of 2007 “Sentinel engaged in a five-day reverse repurchase transaction–called a “Repo Transaction”–with FTN.” They also allege that Sentinel used this transaction to benefit their 2006 year-end accounting figures, but did not properly report “a liability associated with its obligation to repurchase the securities when the Repo Transaction was unwound.”

While Sentinel Management Group is now out of business, FTN Financial Securities is still in business and registered with securities regulators. According to reports, “The SEC ordered FTN to cease committing any future violations, and also said the firm must pay back $1,495,878 to clients as well as prejudgment interest of $377,759.” FTN has not admitted or denied the SEC’s allegations.

If you are concerned about your investments with FTN Financial Securities Corp. or otherwise believe you have been the victim of investment fraud and would like to speak to a securities attorney about your particular situation please call our Chicago office at 312-238-9650.

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida.

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