FINRA barred former J.P. Turner & Company LLC registered principals Brian Matt Borakowski and George Alexander Kardaras after finding they engaged in securities fraud and defrauded investors facilitated through the use of a Ponzi scheme. The findings state that the duo defrauded investors who purchased promissory notes issued by a company Borakowski both organized and controlled, improperly using investor funds to pay for business and personal expenses and to finance payments to earlier investors.
Though Kardaras remained with J.P. Turner & Company during the violative period of 2007-2011, Borakowski joined American Capital Partners, LLC and Berthel, Fisher & Company Financial Services, Inc. after leaving J.P. Turner.
In the Office of Hearing Officers' default decision, Borakowski and Kardaras were charged with converting customer funds, engaging in prohibited private securities transactions, securities fraud and failure to provide requested information to FINRA investigators.
According to the OHO, in 2006, Borakowski organized Echo Canyon LLC and both brokers began soliciting customers of their respective employer firms to invest in Echo Canyon, selling promissory notes outside the regular course and scope of their associations with the firms.
The duo allegedly told customers that Echo Canyon's purpose was to purchase automobiles at United States auctions and ship the vessels to Russia for resale.
After allegedly accruing $665,000 in investments from multiple customers, Borakowski and Kardaras used $634,000 (95% of the funds) to pay personal and business expenses and to make payments to earlier investors in what FINRA determined was a Ponzi scheme.
FINRA also said the pair "never intended to use the customers' funds as represented" and plainly "acted with scienter," or with the intent or knowledge of wrongdoing sometimes referred to as "guilty knowledge."
By virtue of their actions, FINRA alleges Borakowski and Kardaras deliberately made misstatements and omitted material facts in the furtherance of committing securities fraud.
In determining sanctions, FINRA did not request restitution because the Arizona Corporation Commission already ordered Borakowski and Kardaras to pay restitution.
If you have invested with Brian Matt Borakowski, George Alexander Kardaras, JP Turner & Co. or with any broker, firm or financial professional whose misrepresentations, omissions of fact or misconduct you believe to be fraudulent or otherwise improper has resulted in harm to your investments or interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for an investigation and consultation.