Monday, May 11, 2009

Carnahan Recovers Over $145,000 for Missouri Investors Caught in Foreign Currency Trading Scheme

Press Release Missouri Secretary of State Robin Carnahan

Jefferson City, MO – Secretary of State Robin Carnahan’s office today secured $146,050 in restitution for eight investors who suffered heavy losses when their broker, an agent of Princor Financial Services Corporation, inappropriately placed their savings in a foreign currency trading program.

Princor, with an office in Chesterfield, has agreed to reimburse investors as a result of the firm’s failure to supervise one of its agents, Dorian Saunders, and his outside trading activity.

“During these tough economic times, investors should always double check to make sure the investments they are getting into are legitimate,” said Carnahan. “I am pleased that we were able to stop this scheme and get these investors their savings back.”

Beginning in early 2007, Saunders opened accounts for some of his Princor clients at a foreign currencies trading firm run by his brother. Saunders recommended that these clients cash in investments that he had previously sold them and invest that money in foreign currency trading. The eight clients who invested in foreign currencies through Saunders eventually lost all of their funds.

“I was told that I would get regular checks in the mail, but months went by and nothing ever showed up” said Shirley, a St. Louis area investor. “I trusted him when he promised this was a good investment. Now I know that I should always check it out first.”

The consent order entered today finds that Princor was aware of Saunders’ outside foreign currencies trading, and requires Princor to pay back all of the funds lost by the eight impacted investors, six of which reside in Missouri.

“I feel like I was preyed on by my broker,” said Michael, an investor from Bourbon, Mo. “I was cleaned out of $7,000 and left with a balance of 25 cents. It’s good to know that this incident is not going unpunished and that the company is taking responsibility for its employee.”

In November, Saunders was barred from the securities industry. Saunders’ “selling away” or completing transactions for Princor clients outside the firm’s books and records is specifically identified as a dishonest or unethical business practice under Missouri law. In addition to paying full restitution to the investors, Princor has also agreed to make a $75,000 payment to the Missouri Investor Education and Protection Fund, and to pay the costs of the Division’s investigation.

For more information regarding investments and fraud protection, visit the Secretary of State’s online Missouri Investor Protection Center at www.MissouriSafeSavings.com or call the toll free Investor Protection Hotline at 1-800-721-7996.

No comments: