Facts

Claimants Robert Resnick and Wai-Pang Resnick filed an arbitration claim against Morgan Stanley Smith Barney LLC that involved claimants' investments in junk bonds.

CLAIMANTS' CONTENTIONS: Claimant contended respondent engaged in fraud, negligent misrepresentation, and breached its fiduciary duty when Respondent managed claimants' investments. Claimants further contended respondent engaged in fraudulent investment related sales, fraudulently converted funds, forged signatures, and misrepresented material information. Claimants' contended respondent gave fraudulent advice and recommendations when it managed claimants' accounts.

Claimant asserted causes of action for fraud, negligence, misrepresentation and other violations of Unfair Competition laws.

RESPONDENT'S CONTENTIONS: Respondent denied claimants' contentions and requested all claims against respondent be dismissed. Additionally, respondent requested to have unnamed parties Christopher Butler and Kevin Butler's information expunged from the Central Registration Depository record.

Damages

Claimants contended they were entitled to $395,579.00 in compensatory damages.

Result

The panel found for respondent and denied all of claimants' causes of action. The panel recommended unnamed party Kevin C. Butler's information be expunged from the CRD because the panel determined Kevin was not involved in the investment allegations, did not manage claimants' investments, and did not make any recommendations or advise claimants.

Other Information

ARBITRATORS: Mary M. O'Neil, presiding chairperson; Aurelio A. Garcia; Loyd A. Wright.