The law firm of Oakes & Fosher is presently investigating the alleged misconduct of former securities broker Michael Rappa. According to his publicly available FINRA BrokerCheck report, Michael Rappa has been the subject of multiple customer disputes.
Michael Rappa was a California based securities broker. He worked in the securities industry for thirteen years. During his career, he was registered with four different securities firms. He is no longer working as a registered securities broker in any fashion.
His Registrations
- The Metropolitan Life Insurance Company (2004)
- MetLife Securities (2004)
- Princor Financial Services Corporation (2004-2010)
- Foresters Equity Services (2010-2017)
The Allegations
- In February 2018, customers alleged that Michael Rappa engaged in unsuitable private securities transactions. This case is currently pending. The customers are seeking $700,000 in damages.
- In May 2018, more customers alleged that Michael Rappa recommended highly unsuitable private securities. This case is currently pending. The customers are seeking $75,000 in damages.
- In February 2019, Michael Rappa was officially sanctioned by FINRA. The findings in this matter state that the private transactions he was engaging in involved the selling of almost $3 million in promissory notes associated with a non-traded real estate investment fund. For his recommendations, Michael Rappa received a total of $109,939 in commissions. The fund that issued these promissory notes later filed for chapter 11 bankruptcy. Due to these allegations, Michael Rappa was barred by FINRA from acting as a securities broker in any fashion.
What Does This Mean?
Promissory notes are products issued by speculative private companies looking to expand in some fashion. These differ from purchasing actual equity, as the purchaser is “promised” back a certain amount–plus interest. The fluctuation of a security’s value does not automatically affect the value of a promissory note. Because of this, many securities brokers misrepresent these products to investors by convincing them they are safe investments. However, most note purchasers are not made aware that the issuing company’s ability to pay is entirely dependent upon their success. If these companies fail in their new ventures or declare bankruptcy, they often default on issued promissory notes–leaving investors in the exact same position if they had purchased equity in the high risk, private company.
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 Michael Rappa, please contact Oakes & Fosher for a free and private consultation. Oakes & Fosher handles cases on a contingency basis, which means there are no fees charged unless we collect for you.
