The law firm of Oakes & Fosher is presently investigating the alleged misconduct of former securities broker Douglas P. Simanski. According to his publicly available FINRA BrokerCheck report, Douglas P. Simanski has been the subject of numerous customer disputes in connection with an alleged Ponzi scheme.

Douglas P. Simanski was a Pennsylvania based securities broker. He worked in the securities industry for twenty-one years. During his career, he was registered with just two different securities firms.

His Registrations

  • Advantage Capital Corporation (1995-1999)
  • Next Financial Group (1999-2016)

The Allegations

According to a publicly available press release put out by the Securities and Exchange Commission, Douglas P. Simanski allegedly raised over $3.9 million from about twenty-seven investors who were customers of Next Financial Group. Most of these investors were retired and/or elderly. Simanski allegedly told these investors he was placing their money in tax free investments.

Simanski allegedly told the investors to write checks out to a personal bank account that he opened in his wife’s name. He then allegedly operated a Ponzi scheme where instead of investing the customer funds, he deposited them into his personal accounts and used the funds for his own personal use.

The Securities and Exchange Commission charged him with violating anti-fraud provisions of federal securities laws. He was barred by FINRA on an indefinite basis for allegedly failing to comply with their investigation into the matter. The Securities and Exchange Commission has said that they will be barring Douglas P. Simanski from acting as a registered securities broker for the rest of his life.

He was also charged criminally by the U.S. Attorney’s Office for the Western District of Pennsylvania. These charges were that of ‘Securities Fraud’, ‘Wire Fraud’, and ‘False Income Tax Return.’ He pled guilty to these charges.

Twenty-four complaints were filed against Next Financial Group due to the alleged actions of Douglas P. Simanski following his termination. These complaints were all filed on behalf of the individuals who had been victimized by his alleged Ponzi scheme. Most of these complaints have been settled, resulting in a total of $2,348,551 being returned to the defrauded customers.

Ponzi Schemes

Ponzi schemes are fraudulent investment schemes in which a securities broker, or group of brokers, convert funds from their customers. They occur when a perpetrating party solicits fund from investors under the guise of a legitamate investment. However, instead of investing the funds as they claimed they would, the perpetrating party diverts the funds for other purposes–often for personal expenses. The perpetrating party then provides investors with falsified information showing them how their investment is performing. However, since the money is not being invested no actual profit is being made. Because of this, investor dividends or buy outs are paid through money coming in from later rounds of investors. This process continues until the entire thing collapses, as it did for Douglas P. Simanski.

Oakes & Fosher Can Help

Many investors are unaware of the legal recourse available to them after losing money due to securities broker fraud and/or negligence. The truth is that investors who have lost money in this fashion may actually be entitled to damages.

Oakes & Fosher dedicates its entire legal practice to helping investors across the nation. If you, or someone you know, have lost money investing with Douglas P. Simanski, please contact Oakes & Fosher for a free and private consultation.