A Financial Industry Regulatory Authority arbitration panel has awarded former NBA basketball player Keyon Dooling and ex-NFL athlete John St. Clair $819,000 in damages in their securities case against Morgan Stanley (MS). The two men accused the firm of negligent supervision of a former broker whom they blame for their investment losses.
The rogue broker, Aaron Parthemer, has since been barred from the securities industry. It was Parthemer who recommended that the former professional athletes put money into two businesses. Dooling invested $700K in apparel company Global Village Concerns and Miami Beach night spot Club Play. St. Clair invested $200,000 in Global Village Concerns. According to the ex-pro athletes’ securities fraud lawyers, the two investments proved worthless.
Now, the FINRA arbitration panel says that Morgan Stanley must pay Dooling and his spouse over $608K while St. Clair and his wife are to get over $200K. Meantime, Morgan Stanley disagrees with the panel’s ruling, contending that that it was Parthemer who failed to let the firm know that he was engaged in external investment activities. This was the alleged reason that FINRA barred him from the industry.
For instance, Parthemer is accused of lending $400K to three clients without getting his firm’s consent, giving former employers Wells Fargo (WFC) and Morgan Stanley, as well as FINRA, false information, presenting private securities transactions that went undisclosed and involved clients that invested over $3M, running a nightclub, operating a marketing firm, and winning a contract to promote a tequila brand.
Parthemer has not denied or admitted to FiNRA’s findings in this case. Before his bar from the securities industry by FINRA, Parthemer worked as a broker for two decades.
Professional Athletes & Securities Fraud
St. Clair and Dooling worked hard as professional athletes to make their earnings. Dooling played for over half a dozen NBA teams, as did St. Clair, who was an NFL player for 11 seasons.
It can be devastating for an investor to lose their earnings when instigated by fraud or negligence by their financial adviser. At the SSEK Partners Group, we are here to help our high net worth clients, including professional and former pro-athletes, to recoup their investor fraud losses. Contact us today.