Private Placement, Fraud, Misrepresentation and Unsuitable Recommendation FINRA Arbitration and Litigation Lawyer, Russell L. Forkey, Esq.

December, 2011:

Michael Daniel Shaw (CRD #1571907, Registered Representative, Baton Rouge, Louisiana) submitted a Letter of Acceptance, Waiver and Consent in which he was barred from association with any FINRA member in any capacity. Without admitting or denying the findings, Shaw consented to the described sanction and to the entry of findings that acting on his member firm’s behalf, he recommended and effected the sale of high-risk private placements to customers without having a reasonable basis to believe the transactions were suitable given the the customers’ financial circumstances and conditions; Shaw earned a total of $56,733 in net commissions on the transactions. The findings stated that Shaw made material misrepresentations or omissions in connection with the purchases or sales in connection with the private placements; despite the description of each product as high risk or highly speculative in the offering documents, Shaw intentionally misinformed customers that the investments were safe and secure, and represented one product as a relatively low-risk investment. The findings also stated that Shaw falsified account documents for customers, increasing net worth and changing risk profiles. The findings also included that Shaw and his firm settled with one of the customers; the firm settled with another. (FINRA Case #2010022963601).