FINRA Arbitration Panel Orders Pershing to Pay Stanford Victims

Posted on July 20th, 2021 at 2:56 PM
FINRA Arbitration Panel Orders Pershing to Pay Stanford Victims

From the Desk of Jim Eccleston at Eccleston Law:

The Financial Industry Regulatory Authority (FINRA) has ordered Pershing to pay $648,543 to an additional group of investors who claimed to have lost money in R. Allen Stanford’s Ponzi scheme. While Stanford is serving a 110-year prison sentence, a three-person FINRA arbitration panel posted the judgment on the regulator’s website. Another FINRA arbitration panel in February 2020 ordered Pershing to pay $5.6 million in damages to 23 investors who alleged to have lost money in Stanford’s Ponzi scheme. 

The group of investors alleged that Pershing “acting as custodian and clearing firm for Stanford Group Company … gave material assistance to a Ponzi scheme, involving certificates of deposit”, which were issued by Stanford International Bank and recommended by SGC advisors. The FINRA arbitration panel ordered Pershing to pay much less than what was sought, which included $436,000 in compensatory damages to Charles A. Pope, $124,593 in compensatory damages to Dudley Devore IRA, $87,200 in compensatory damages to Joyce E. Cagle. According to the panel, Pershing “knew or should have known that it was providing meaningful/substantial assistance to that wrongful scheme by remaining the clearing firm for SGC in the United States and, more particularly, by facilitating wire transfers for the purchase of CDs issued by SIBL on behalf of Charles A. Pope, Dudley Devore IRA, and Joyce E. Cagle during 2008.”

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

Tags: eccleston, finra, stanford, arbitration

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