What Did Your Brokerage Firm or Investment Adviser Do Wrong With GWG
Published On: May 19, 2020

Chicago-based Stoltmann Law Offices, P.C. is currently investigating claims on behalf of TCA Global Credit Fund and TCA Fund Management Group investors involving Royal Alliance advisor Mark Young, and Watts Capital, LLC and Thomas Watts. On May 11, 2020, the United States Securities and Exchange Commission (SEC) filed a civil suit in federal court in Miami, Florida against TCA Fund Management Group and TCA Global Credit Fund.

The SEC complaint seeks to prevent TCA Fund Management Group and the Global Credit Fund from committing ongoing securities law violations and also sought the appointment of a receiver. The SEC alleges that for many years, the TCA Global Credit Fund, through its affiliate TCA Fund Management, intentionally inflated the net-asset-value – or price – of the fund hiding massive losses from investors. The SEC alleges that TCA inflated these values in two ways.  First, the fund recognized revenues that it never actually received. It would essentially book a gain on loan fees prior to actually receiving them and if the loans never closed, TCA would not adjust their books to reflect reality. The second way TCA artificially inflated its books, according to the SEC, was to book investment banking fees it never actually earned, and actually knew in many instances that it would never earn. Basically, the way this scam worked, according to the SEC, is TCA would enter into a contract with a company to perform investment banking services for, let’s say, $100,000.  Instead of waiting to actually perform the services and receive the $100,000 payment, TCA would book the $100,000 as received on their books at the time the contract was executed. The result of these practices was to provide investors with inflated values of these funds. The SEC alleges that these practices violations Section 17(a) of the Securities Act of 1933, 15 U.S.C. Section 77q(a), and Section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. Section 78j(b), and Exchange Act Rule 10b-5, 17 C.F.R. Section 240.10b-5; and violations of Sections 206(1), (2), and (4), along with Section 2076 of the Investment Advisers Act of 1940, 15 U.S.C. Sections 80b-6(1), 80b-6(2), 80b6(4), and 80b-7, and Advisers Act Rules 206(4)-7 and 206(4)-8, 17 C.F.R. Sections 275.206(4)-7, 275.206(4)-8.

According to documents field with the SEC for TCA funds, called a Form D, TCA Fund Management Group used numerous FINRA-Registered broker/dealers to sell  investments in the TCA Global Credit Fund for many years including:

  • Mark Young of Royal Alliance Associates, Inc.
  • Thomas Watts, of Karbone Capital and Watts Capital
  • Matthew Luciano of Meyers Associates, L.P
  • Edward Cofrancesco, Jr. of International Assets Advisory, LLC
  • Gilbert Dulberg of International Assets Advisory, LLC
  • Richard D. OReilly of Viewtrade Securities, Inc.
  • Richard Engen of International Assets Advisory, LLC
  • Michael C. Petrycki of Legend Securities, Inc.
  • John Paul Neppel of Great point Capital, LLC
  • Theodore R. Augustyniak of Newport Coast Securities
  • Marcel Melis of Young American Capital, LLC
  • Michael Cooney of Blue Sand Securities, LLC

By virtue of the requirements of FINRA Rule 2111.05 and multiple FINRA regulatory notices, including Regulatory Notice 10-22, NASD Notice To Members 03-71, and NASD Notice to Members 05-26, all FINRA brokerage firms, like Royal Alliance, owe investors a duty to perform reasonable due diligence into a private placement like the TCA Global Credit Fund BEFORE the investment is approved for sale to investors. This obligation is rooted in the FINRA Suitability Rule.  Brokerage firms also have an obligation under FINRA Rule 3110 and the Securities Act to reasonably supervisor the conduct of their financial advisors.  This is especially true when advisers are selling private placements like the TCA Global Credit Fund.

If you were sold an investment in the TCA Global Credit Fund, or one of the other TCA “feeder funds” through a financial advisor, you may have a claim to purse through FINRA Arbitration. Stoltmann Law Offices has recovered tens of millions of dollars for defrauded investors since 2005 pursuing brokerage firms through arbitration and litigation. Please contact Stoltmann Law Offices at 312-332-4200. We offer representation nationwide on a contingency fee basis, which means we do not get paid until you do.


The posting on this site are mere OPINIONS and NOT statements of fact in any way whatsoever. The information should not be relied upon and there have been no findings made against the firms or individuals referenced on this site. In addition, this Blog is made available for educational purposes only and incorporates information from the web as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney client relationship between you and Stoltmann Law Offices (161 N Clark Street 16th Floor Chicago, IL 60601). The Blog opinions should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.


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