Complaint Issued Against John Cherry III Alleging Improper Use, Conversion of Customer Funds

The Financial Industry Regulatory Authority filed a Complaint alleging that broker John Cherry III, formerly of World Group Securities, Inc. ("WGS") misused at least $374,000 of customer funds and failed to disclose outside business activities. In 2011, WGS filed a Form U-5 with FINRA, disclosing Cherry's termination from the firm because he "was not believed to have been fully forthcoming" with an internal investigation surrounding the above matter.

FINRA Case #20110269351

According to FINRA'S Complaint, Cherry convinced two customers to invest with him, but instead of investing in securities as they instructed, Cherry deposited the funds into bank accounts which he personally controlled, converting the customers' funds for personal use.

The allegations state that Cherry falsely represented to his customers that their funds would be invested in securities purchased through WGS. He received a total of at least $374,000—including $50,000 obtained after one of his customers took out a reverse mortgage—either by check or wire, payable to Cherry Group, Unlimited, LLC.

FINRA's allegations state Cherry used a portion of these converted funds to purchase a house in Kissimmee, Florida in the name of his wife and that Cherry did not report to World Group neither his involvement with Cherry Group or his income from the aforementioned outside business activities.

As of the date of this posting, the complaint, filed by FINRA, has not been adjudicated otherwise resolved. WGS is an inactive FINRA member firm, having terminated its registration on February 1, 2012.

If you invested with John Cherry III or any other broker or firm who has persuaded you to invest with or write a check directly to an individual or business other than the FINRA-member firm, and this has proven harmful to your financial interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for an investigation and consultation.

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