Belesis firm drops suit against ex-reps claiming 'pump and dump' scheme

Defendants' attorney calls media darling's conduct 'venomous'

Feb 8, 2013 @ 12:06 pm

By Bruce Kelly

John Thomas Financial Inc. has withdrawn from a lawsuit it filed in January against five ex-brokers, according to the ex-brokers' attorney.

In January, John Thomas, which is run by chief executive and owner Anastasios “Tommy” Belesis, sued the five ex-brokers, along with National Securities Corp., the firm they joined.

The brokers named in the suit, which was filed in State Court in Manhattan, are Renos Gordos, Rodney Laveau, Anthony Mauiolo, Darren Himmelstein and Keith Williams. John Thomas alleged in the complaint that the five brokers, who left in December, used stolen proprietary information to lure away customers, costing John Thomas more than $10 million.

According to affidavits filed in response to the lawsuit, John Thomas, through Mr. Belesis, promoted at least one “pump and dump” stock scheme and recently filed a complaint with the New York City Police Department against the ex-brokers, claiming that the brokers engaged in theft of property and fraud.

Mr. Belesis and other principals of John Thomas use promoters to present securities and companies to the firm's representatives to get the brokers to sell the securities to increase the price of the shares. At the same time, the firm instructs promoters to sell into the market, according to the affidavits.

One example of a “pump and dump” scheme occurred with Liberty Silver Corp., a company that John Thomas recommended to its clients, according to the affidavits.

Mr. Belesis “runs a boiler room operation like a tyrant,” hollering and screaming at reps during the day, according to the brokers' testimony. “He tells registered reps to essentially ignore their client's investment objectives and tries to push securities on clients that are far from appropriate.”

Richard Roth, the brokers' attorney, said he was appalled at the brokers' treatment by John Thomas. “John Thomas' aggressive action was astonishing,” Mr. Roth said. “I have never seen such venomous conduct in my career.”

He added that John Thomas withdrew the case this week. Mr. Belesis did not return calls seeking comment.

Troubles continue to mount for Mr. Belesis and his firm. On Thursday, the New York Post reported that John Thomas was under investigation by the FBI, the Securities and Exchange Commission and the Financial Industry Regulatory Authority Inc. for alleged misconduct in selling stock.

Mr. Belesis admonished brokers not to read private-placement memoranda and screamed at reps to “just sell” the deals, according to the brokers' affidavits. If brokers were not doing sufficient business, they were told to “kill themselves,” according to the court documents.

Securities regulators have turned their attention to Liberty Silver, a mineral exploration company that trades on pink sheets. It traded at a high of $1.55 per share Oct. 4 before the SEC suspended trading in the stock for two weeks “because of a lack of current and accurate information about the company concerning, among other things, the control of its stock, its market price and trading in the stock,” according to the SEC. When trading in Liberty Silver resumed, the price fell to $0.15. On Thursday, the company's shares traded at $0.39.

Mr. Belesis is a frequent guest on the Fox Business channel and appeared in Oliver Stone's 2010 sequel to the film “Wall Street.”


What do you think?

View comments

Recommended for you

Featured video


The #MeToo movement and the financial advice industry

Attendees at the Women to Watch luncheon commend the #MeToo movement for raising awareness about the issue of sexual harassment and bringing women together.

Latest news & opinion

What the next market downturn means for small RIAs

Firms that have enjoyed AUM growth because of the runup in stocks may find it hard to adjust to declining revenues if the market suffers a major correction.

DOL fiduciary rule likely to live on despite appeals court loss

Future developments will hinge on whether the Labor Department continues the fight to remake the regulation its own way.

DOL fiduciary rule: Industry reacts to Fifth Circuit ruling

Groups on both sides of the fiduciary debate had plenty to say.

Fifth Circuit Court of Appeals vacates DOL fiduciary rule

In split decision, judges say agency exceeded authority.

UBS, after dumping the broker protocol, continues to see brokers come and go

The wirehouse has seen 14 individuals or teams leave and five join for a net loss of $2.4 billion in AUM


Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting It'll help us continue to serve you.

Yes, show me how to whitelist

Ad blocker detected. Please whitelist us or give premium a try.


Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print