FINRA Panel Awards $543,612 In A Medical Capital Holdings Case
A Financial Industry Regulatory Authority (FINRA) arbitration panel in Los Angeles awarded $543,612 in compensatory damages against an independent brokerage firm, Cullum & Burks, to an investor. According to press releases, the retiree was talked into moving his entire lifesavings into an extremely risky investment fund offered by Medical Capital Holdings. Investors sunk $2 billion into the private placements and $1 billion are in default, resulting in massive losses to those who invested in them. The claimant in this case lost his entire lifesavings in a little over a year and his had to try and return to the work force to support his family.
Unfortunately, there may never be any recovery in the case because the brokerage firm of Cullum & Burks was one of several small independents that were forced out of business due to their involvement with Medical Capital. The Dallas based firm bit the dust in the summer of 2010, when FINRA pulled their license for failing to have sufficient capital on hand to remain open for business. According to the award, neither the firm nor the broker bothered to show up at the hearing. (FINRA # 10-01597; Eric Anderson v. Cullum & Burks Securities, Inc. and Robert J. Clark)