Quantcast

Kovack Securities aided in breach of fiduciary duty, consumers allege

By Jenie Mallari-Torres | Sep 4, 2018

ATLANTA (Legal Newsline) – A Florida broker-dealer and its president/owner are alleged to have aided in a breach of fiduciary duty by assisting in a fraudulent asset transfer.

Delutha H. King, individually and as executor of the estate of Cecil C. Keck and the estate of Mabel W. Keck; Lois W. King; Ronald H. Loving; and Kristie L. Taylor filed a complaint on Aug. 28 in the U.S. District Court for the Northern District of West Georgia against Kovack Securities Inc. and Brian Kovack citing the Uniform Fraudulent Transfer Act and other counts.

According to the complaint, the plaintiffs entrusted their life savings to Resource Horizons Group and its former representative, Robert Gist. The suit states Gist engaged in a scheme to steal funds from plaintiffs' accounts for his own purposes and was later convicted and imprisoned. The plaintiffs allege they lost all of the money they gave to Gist to invest.

The suit states the plaintiffs filed arbitration claims with the Financial Industry Regulatory Authority (FINRA) against Resource Horizons over their losses and during this arbitration, the then-president of Resource Horizons Kelly Miller began discussions with Kovack Securities to purchase Resource Horizons assets.

The suit states the plaintiffs were awarded $3.8 million against Resource Horizons in 2014 by the FINRA panel and Resource Horizons has not paid the award and remains indebted to the plaintiffs.

The plaintiffs hold Kovack Securities Inc. and Kovack responsible because the defendants allegedly aided and abetted Miller's breach of fiduciary duty by knowingly assisting in the fraudulent transfer of assets to Kovack Securities.

The plaintiffs request a trial by jury and seek judgment against defendants in an amount no less than $75,000, plus all consequential, incidental, general, and other damages, attorney's fees, costs of action, interest, and further relief as the court may deem just. They are represented by David J. Hungeling and Adam S. Rubenfield of Hungeling Law in Atlanta, Georgia.

U.S. District Court for the Northern District of Georgia case number 1:18-cv-04079

Want to get notified whenever we write about U.S. District Court for the Northern District of Georgia ?

Sign-up Next time we write about U.S. District Court for the Northern District of Georgia, we'll email you a link to the story. You may edit your settings or unsubscribe at any time.

Organizations in this Story

U.S. District Court for the Northern District of Georgia

More News

The Record Network