The law firm of Oakes & Fosher is currently investigating the possible misconduct of former securities broker James Kolf. According to his publicly available FINRA BrokerCheck report, James Kolf was sanctioned by the United States Securities and Exchange Commission in 2017.

James Kolf was a Wisconsin based securities broker. He worked in the securities industry for thirty-four years. During his career, he was registered with five different securities firms.

His Registrations

  • John Hancock Mutual Life Insurance Company (1981-1997)
  • Signator Investors (1981-2009)
  • New England Securities (2009-2015)
  • MetLife Securities (2015-2016)
  • NYLIFE Securities (2016)

The Allegations

James Kolf was sanctioned by the United States Securities and Exchange Commission in November 2017. The findings in this matter state that Kolf created a fictional company that he used to solicit funds from existing customers of his member firm. James Kolf allegedly presented this company as a business that would invest in energy companies. He allegedly told potential investors that they would receive returns of six to eight percent per year. Due to these alleged misrepresentations, fourteen customers of his member firm liquidated their investments at the firm and gave it to James Kolf as an investment in his fabricated company. These investments came out to be $905,077.

The SEC’s findings state that James Kolf did not invest the funds as he said he would, but rather converted the funds for his own personal use. This included buying himself a house, paying of credit card debt, and paying off an outstanding tax liability. In order to keep investors non the wiser, he made dividend payments to investors from the principal investment that he disguised as growth. Doing this is what is known as a Ponzi scheme. Due to these alleged actions, he was barred by the Securities and Exchange Commission from acting as a securities broker in any fashion.

Ponzi Schemes

Ponzi schemes take place when an individual, or group of individuals, implement a fraudulent investment scheme designed to deceive investors about how their investment is doing. The process begins by the implementing party soliciting funds from investors. The investors are usually promised a substantial amount of growth. However, instead of actually investing the money as they said they would, the implementing party misappropriates it for other purposes. This can range from the broker stealing the money for their own personal use, or rather just using the money for undisclosed investments. The broker then provides the investors with falsified information about how their investment is growing. In order to pay promised dividends, or to pay investors who wished to liquidate their shares, the broker simply uses left over money from the original investment, or uses money coming in from new investors. This continues until the entire thing collapses.

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. Oakes & Fosher dedicates its entire legal practice to helping investors who have lost money in this fashion. If you, or someone you know, have lost money investing with James Kolf, please contact Oakes & Fosher for a free and private consultation.