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May 05, 2023 at 02:45 PM
Oppenheimer & Co. has been ordered by a Financial Industry Regulatory Authority arbitration panel to pay another $14 million over alleged supervisory failures related to its role in a sketchy fund that was later identified as part of a Ponzi scheme.
According to an award that was signed by a three-person public arbitration panel on Wednesday and posted on FINRA’s website on Thursday, Oppenheimer was at least partially responsible for the losses reported by multiple clients of the firm after they were convinced by a broker at the company to invest in Horizon Private Equity III, a fund that promised huge returns but never delivered any profits.
In the amended statement of claim, the claimants asserted causes of action against Oppenheimer that included: violations of FINRA rules; breach of fiduciary duty; aiding and abetting breach of fiduciary duty; breach of contract and breach of the duty of good faith and fair dealing; and unlawful sales of securities.
The award followed a FINRA arbitration award of about $1.5 million in March and a $36.7 million award by a FINRA arb panel in September, both of which were decided against Oppenheimer.
Combined, FINRA arbitration panels have now awarded more than $52 million to Oppenheimer clients who were victims of the scam that was allegedly run by John Woods, the Horizon fund’s operator, and his Atlanta, Georgia-based registered investment advisor firm Southport Capital.
