Securities fraud attorneys are currently investigating claims on behalf of the customers of James E. Neilsen. These investigations are concerning Neilsen’s conduct and the sale of investment agreements and promissory notes while he was registered with Tradition Asiel Securities, Longship Alternative Asset Management, and Sound Securities.
On January 9, 2014, Neilsen was put under an Order to Cease and Desist, Order to Make Restitution, Notice of Intent to Fine and Notice of Rights to Hearing by the Banking Commissioner of the Connecticut Department of Banking. The order was amended on February 18. According to the allegations laid out in the order, to finance his partners’ business expenses, Neilsen individually and/or on behalf of his partners sold approximately $10 million in promissory notes and investment agreements that weren’t registered and weren’t exempt from being registered with the state. The conduct allegedly occurred between November 2005 and around September 2011. The order also states that though some investors have been partially repaid by Neilsen, $7 million remains outstanding.
Promissory notes are a type of debt sometimes used by companies in order to raise money. Through the note, the company promises to return the investor’s principal and pay fixed interest amounts. They have set terms and repayment periods that should be stated specifically in the note. According to stock fraud lawyers, some promissory notes are fraudulent from the beginning and exist only to convince investors they are entering into a contractual arrangement when, in reality, they are not. Others are real securities that, despite the fact that they should be registered with regulatory bodies, bypass registration and are sold as unregistered securities.
Reportedly, Neilsen was registered with Tradition Asiel Securities from November 2004 through July 2007. Then, from August 2008 to December 2009 he was registered with Sound Securities, which is now defunct. Finally, he was registered with Longship Alternative Asset Management from January 2010 through January 2011. According to Securities fraud attorneys, FINRA rules dictate that firms have an obligation to properly supervise brokers’ activities while they are registered with the firm. Therefore, if these firms did not properly supervise Neilsen’s activities, they could be held liable for his clients’ losses.
If you purchased investment agreements and/or promissory notes from James E. Neilsen, CRD No. 4825841, you may be able to recover your losses through securities arbitration. To find out more about your legal rights and options, contact a stock fraud lawyer at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 or newcases@investorlawyers.net for a no-cost, confidential consultation.