The case underscores the importance of regulatory vigilance in the investment industry. Despite assurances of safety and profitability, Woods’s actions demonstrated a flagrant abuse of trust, ultimately causing financial ruin to hundreds of victims across 20 different states.

Investment Advisers are fiduciaries, and as such they owe their customers duties of care and loyalty, both of which were flagrantly breached in this situation. Mr. Woods was a longtime investment adviser representative at Oppenheimer & Co., Inc.

Although Investment Advisory firms and brokerage firms (Broker-Dealers) often claim they are not legally responsible for the unauthorized actions of their advisers, the law of most states holds otherwise. Firms can be legally responsible for the actions of their agents even if the agents acted solely for their own purposes and the firms received no compensation for the wrongful acts. Furthermore federal and state securities laws hold “control persons” liable for agents under their control, and firms further may be liable for breaches of their duties to supervise their agents.

If you believe you were the victim of a ponzi scheme or other fraudulent actions of your investment advisor, please contact securities fraud attorney Scott Greco for a free consultation about your potential case. Greco & Greco has decades of experience representing investors across the country for similar situations.

Kennedy’s actions, as detailed in the findings and conclusions of the order, paint a troubling picture of misconduct and deceit. He directed over 5,300 trades totaling more than $350 million in the accounts of six customers, with an average of 102 trades per account each month. These excessive transactions generated substantial commissions for Kennedy while causing substantial losses for his clients. Moreover, Kennedy went to lengths to conceal the true extent of these losses by fabricating account statements and providing false information to his clients.

The disciplinary order found Kennedy in violation of several securities regulations, including Section 10(b) of the Securities Exchange Act of 1934, Regulation Best Interest, and various FINRA rules.

Mr. Kennedy’s FINRA Brokercheck Report reports ten customer complaints in the past several years, most of which have been settled, many for multiple millions of dollars.

If you believe you may be the victim of a financial advisor who has churned your accounts, please contact Investment Fraud attorney Scott Greco for a free attorney consultation about your potential claim.

These investments obviously carry higher risks than if an investor just invests in a single stock, and can include similar risks to using margin to purchase more shares of a stock than you can afford with cash, or risk shorting a stock in the hope that the price declines. Additionally, similar to inverse and leveraged ETFs that are spread over a sector of stocks, these ETFs reset daily, so if they are held for more than a day the price of the ETF can diverge significantly from the price of the underlying stock.

Financial advisors should not be recommending or purchasing these types of ETFs for retail investors unless the investor understands the risks involved and can afford to take those risks. Such a recommendation should be suitable and in the best interest of the customer. If you have lost monies in a single stock ETF that you did not understand or that was not suitable for your risk tolerance, please contact W. Scott Greco for a free attorney consultation about your potential case.