Investor Lawyers Blog
Investors in Woodbridge, either through a First Position Commercial Mortgage (commonly referred to as a “FPCM” or “note”) or in any Woodbridge “units” upon the recommendation of former broker David Ferdwerda (CRD# 832431) may be able to recover your losses through securities arbitration. As recently disclosed by FINRA, as of October 30, 2018, FINRA barred registered representative David Carl Ferdwerda (“Ferdwerda”) from the securities industry due to his purported failure to provide requested documents and information to FINRA concerning his sales of Woodbridge securities.
According to publicly available FINRA records, from 2012 through March 2018, Mr. Ferdwerda was affiliated with broker-dealer Signator Investors, Inc. (BD No. 468) (“Signator”) in the firm’s Grand Rapids, MI office. Further, FINRA BrokerCheck indicates that Mr. Ferdwerda was discharged from his employment with Signator on or about March 20, 2018 due to his alleged “Involvement in the sale of unapproved outside investments in violation of firm policy.” Through his alleged nonresponsiveness to FINRA Enforcement’s investigation, Mr. Ferdwerda neither admitted nor denied FINRA’s findings.
As has been alleged by the SEC, Woodbridge and its owner and former CEO, Mr. Robert Shapiro, purportedly “used his web of more than 275 Limited Liability Companies to conduct a massive Ponzi scheme raising more than $1.22 billion from over 8,400 unsuspecting investors nationwide through fraudulent unregistered securities offerings.” According to Steven Peiken, Co-Director of the SEC’s Enforcement Division, the Woodbridge “[b]usiness model was a sham. The only way that Woodbridge was able to pay investors their dividends and interest payments was through the constant infusion of new investor money.”
Pursuant to FINRA Rule 3280(b), registered representatives are prohibited from participating in private securities transactions, without first providing written notice to their employer firm. Such written notice must set forth in detail the proposed transaction, as well as the financial advisor’s proposed role with regard to the contemplated transaction, and furthermore, whether he or she will receive any compensation in connection with the transaction
Regardless of whether Mr. Ferdwerda’s alleged outside business activity was conducted without Signator’s knowledge, employers in the securities industry have an affirmative duty to ensure that their brokers are adequately supervised. Accordingly, brokerage firms must take reasonable steps to ensure that their employees follow all applicable securities rules and regulations, as well as adhere to the firm’s internal policies and procedures. In instances when brokerage firms fail to adequately supervise their brokers, they may be held liable for losses sustained by investors.
The attorneys at Law Office of Christopher J. Gray, P.C. have significant experience representing investors in connection with alleged securities fraud, including Ponzi schemes. Investors may contact us via the contact form on this website, by telephone at (866) 966-9598, or by e-mail at newcases@investorlawyers.net for a no-cost, confidential consultation. Attorneys at the firm are admitted in New York and Wisconsin and various federal courts around the country, and handle cases nationwide (in cooperation with attorneys located in those states if required by applicable rules).