Dollars & Sense

Broker sued for allegedly defrauding professional athletes

Updated: 2013-04-11T16:31:50Z

Bloomberg News

Success Trade Securities, Inc. was sued by the brokerage industry’s self-regulator over claims it sold fraudulent promissory notes to professional athletes.Fuad Ahmed, the chief executive officer of the Washington- based firm, raised more than $18 million since 2009 from 58 investors, many of whom are current or former players in the National Football League and National Basketball Association, the Financial Industry Regulatory Authority said in a complaint issued today.

Finra, which didn’t disclose the names of the harmed investors, filed a temporary cease-and-desist order to halt the alleged misuse of investors’ funds and assets.

Ahmed sold promissory notes offering annual interest rates ranging from 12 percent to 26 percent, Finra said. To meet the monthly interest obligations, the brokerage issued and sold additional notes to new and existing investors, according to the complaint.

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