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Michael Rappa Barred for $2.7 Million-worth of Woodbridge Ponzi Transactions

FINRA barred Foresters Equity Services (San Diego, CA) broker Michael John Rappa for soliciting investors to purchase promissory notes of Woodbridge Group of Companies and related real estate investment funds, ultimately effecting $2.7 million in unauthorized and unapproved transactions.

AWC #2018057766401

FINRA found that Rappa (CRD #4799159) sold more than $2.7 million in Woodbridge notes to at least 21 investors away from the firm, receiving nearly $110,000 in commissions as a result. Customer complaints alleging unsuitable recommendations have already begun to appear in Rappa's file.

Since the SEC deemed the Woodbridge Group of Companies to be a massive Ponzi scheme in 2018—estimating the fraud at $1.2 billion and defrauding at least 8,400 seniors throughout the country—FINRA and other regulators charged many brokers from California to New Jersey for their roles in the purported Ponzi.

More recently, a FINRA arbitration panel ordered Quest Capital Strategies of Lake Forest, CA to pay a defrauded investor $276,226 for misconduct at the hands of former Quest broker Frank Roland Dietrich, who sold more than $10.8 million Woodbridge notes to 58 investors without disclosing the sales to his firm.

As InvestmentNews concluded in the wake of that arbitration award, broker-dealers may be held liable for the actions of rogue brokers even if the offending representative sells away from the firm, and even if the victim isn't actually a customer of the firm. In Dietrich's case, it cost the firm $276,226—which is how much the panel deemed Dietrich's actions harmed the duped investor.

If you have invested with ex-Foresters Equity Services representative Michael John Rappa or with any broker or financial adviser who sold you Woodbridge Group of Companies promissory notes or any private placements or interests away from the firm without authorization, and these unsuitable transactions have proven harmful to your investments, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for investigation and consultation.

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