DeWaay gets reprieve from Iowa court

MAY 30, 2012
DeWaay Financial Network LLC, one of dozens of broker-dealers ensnared in litigation over private placement investments gone sour, got some momentary relief from the Iowa District Court for Decatur County on Thursday. Judge John Lloyd ruled to keep temporary restraining orders in place while he considers the merits of a class action filed against the broker-dealer. The orders prevent more than a dozen arbitration claims filed against the company with the Financial Industry Regulatory Authority Inc. from proceeding. The Finra claims are seeking collective damages of more than $6 million — more than seven times the company's current net capital of $820,000, according to financial documents filed by the firm last month. Lawyers for arbitration claimants asked the court to revoke the restraining order and let their cases with Finra proceed. However, the plaintiff's attorneys who filed the class action against the firm argued that there is not enough money to go around and that the more equitable solution would be to roll all claims into a non-opt out class action. “This is a win for equity and fairness,” said Scott Adkins, a plaintiff's lawyer with Menzer & Hill PA who working on the case. “DeWaay has extremely limited resources and hundreds of clients who've lost a lot of money.” “The balance to be struck here is between the early birds, who would have the whole worm, and the late risers, who would have the worm diced into small pieces,” Judge Lloyd wrote in his decision. The court will now consider the merits of the class action. Executives at DeWaay Financial were not immediately available for comment.

Latest News

Investor accuses Pentwater of manipulating Avis stock in short squeeze
Investor accuses Pentwater of manipulating Avis stock in short squeeze

A fund allegedly built a big stake, sparked a short squeeze, then sold as shares cratered

Point72, Citadel among hedge funds hit by AI vishing attacks
Point72, Citadel among hedge funds hit by AI vishing attacks

Hackers used AI voice cloning to target Point72, Citadel, Millennium and other major money managers on Wall Street.

Financial firms tie compensation to AI proficiency, PwC survey finds
Financial firms tie compensation to AI proficiency, PwC survey finds

Recruiters Philip Waxelbaum and Louis Diamond weigh in on whether AI skills are reshaping advisor pay amid PwC's Financial Services Workforce AI Survey.

Dispatch taps former Hightower, eMoney, and Focus leaders for founding board of advisors
Dispatch taps former Hightower, eMoney, and Focus leaders for founding board of advisors

Hightower's Bob Oros, eMoney's Stephen Langlois, and other industry veterans are joining the data infrastructure firm's inaugural advisory board.

Canadian securities regulators keep pressure on Vancouver financial advisor facing fraud claims.
Canadian securities regulators keep pressure on Vancouver financial advisor facing fraud claims.

Peter Cishecki is facing questions linked to his firm’s debt securities

SPONSORED Direct indexing webinar targets tax-loss harvesting amid market swings

Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains

SPONSORED Who builds the income when the pension disappears?

Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income