FINRA suspended former Morgan Stanley representative, and one-time pitcher for Major League Baseball's Philadelphia Phillies, Patrick Dennis Combs for eliciting a $500,000 investment in a privately-held sports drink company from another professional athlete in a transaction conducted away from Morgan Stanley.
The findings state that Combs (CRD #2720909) solicited the half-million dollar investment by introducing his client to the sports drink company that purportedly sought a pro athlete investor and spokesperson.
Combs allegedly used personal e-mails (e.g., his personal e-mail account, as opposed to his Morgan Stanley address) in these dealings, which FINRA says manifested in a $500k convertible promissory note issued to the unnamed pro athlete and client, who subsequently entered into a spokesman agreement with the sports drink company.
Investigators said that Combs disclosed none of this to Morgan Stanley, and furthermore improperly answered "No" to several questions on compliance questionnaires that asked Combs if he had participated in any private securities transactions within the preceding 24 month period.
Morgan Stanley discharged Combs in 2016 over allegations related to Combs' use of personal e-mail to facilitate a private investment. Combs is also facing a pending customer dispute alleging that Combs misrepresented a non-brokerage affiliated investment.
In 2016, two former NBA and NFL players won over $800,000 in damages from Morgan Stanley, which they accused of failing to supervise a rogue broker "who led the athletes into worthless investments," while in 2013, FINRA charged Fuad Ahmed and Success Trade Securities with running an $18 million fraudulent promissory note scheme targeting NFL and NBA athletes.
If you have invested with ex-Morgan Stanley financial advisor Patrick Dennis Combs, or any broker or registered rep whose communications and private placement business conducted away from their employing firm—and away from regulatory oversight—has proven harmful to your investments or interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for investigation and consultation.