The Securities and Exchange Commission has filed a complaint against former brokers Sheif F. Khan, Larry S. Werbel, and Christopher Cervino this week in the United States District Court for the Southern District of New York. The complaint revolves around an alleged fraudulent securities scheme perpetrated by Edward Durante, a recidivist securities law violator who was released from prison in June 2009 for his last securities fraud conviction.
According to the SEC complaint, Durante defrauded at least 50 investors out of $11 million through the sale of securities in a company he controlled called VGTel, Inc. Durante allegedly went by the fictitious name “Ted Wise” while soliciting stock sales to his victims.
Sheif Kahn, a formerly-registered stockbroker at Ameritas Investment Corp., was allegedly bribed by Durante to transfer clients to Durante. The SEC alleges in its complaint that Kahn advised at least 20 of her clients to sell their annuities and purchase VGTel stock.
Larry Werbel, owner and operator of Evolution Partners Wealth Management in Chagrin Falls, Ohio, allegedly entered into an agreement with New Market, a company owned by Durante, in 2010. Werbel is accused of inducing six of his clients to purchase roughly $2 million of stocks in VGTel. According to the SEC’s accusations, Werbel took no steps to learn anything about VGTel, but nonetheless recommended it to his clients.
Christopher Cervino was a registered broker at COR Clearing LLC from August 2013 to October 2014. In 2013, Cervino allegedly opened accounts for 23 customers to trade VGTel stock at the direction of Durante. Cervino is accused of manipulating the price of VGTel stock with Durante, causing the share price of VGTel stock to increase from $0.25 to $1.90.
The SEC complaint seeks disgorgement of ill-gotten gains, injunctive relief, and civil penalties.
If you lost money with former brokers Sheif F. Khan, Larry S. Werbel, and Christopher Cervino, call our securities fraud attorneys at Meyer Wilson for a free consultation.