Michael James Blake Suspended for Concealing Private Securities Transactions

Michael James Blake, a licensed investment professional, was suspended by FINRA after being charged by the regulators with selling interests to customers without approval from his broker-dealer, providing false information to his employer, and failing to disclose outside business activities.

Blake engaged in private securities transaction involving investment amounting to $3.2 million without prior notice and approval from his firm, in violation of NASD Conduct Rules 3040 and 2110, FINRA stated.

Blake misrepresented in various questionnaires and Outside Business Activity (OBA) forms his involvement in a Limited Liability Company (LLC) which he helped establish in April 2002. He originally informed his employer that his participation was limited to privately investing in a commercial real estate development together with four other friends. He further assured that he did not spend anytime on the business, nor did he receive any compensation as a result thereof, according to the charges.

Blake however failed to amend his declaration as regards the scope of the business, despite the expansion of the LLC into an additional 25 members and with total investments growing to $3.2 million. Of the 28 total investors in the LLC, 12 were found to have been former customers of his employers at the time, the regulators alleged.

He also failed to declare his private securities transactions, despite taking active participation in the LLC by soliciting investors, preparing documentations, processing the forwarding of the funds invested, and appraising investors of the status of their investment in the LLC, according to the charges.

Blake was found to have also comingled his funds with client’s funds, and accepted checks made payable to the LLC, an entity associated with him for a securities transaction, despite the prohibition imposed by his employer.

FINRA suspended Blake for one year, with a fine of $10,000 after finding that he provided false information to his employers and failing to disclose his outside businesses.

The Peiffer Rosca securities attorneys often represent investors who lose money as a result of Ponzi schemes, investment fraud, or stockbroker misconduct. They are currently investigating the possibility of assisting investors with the recovery of their losses. They take most cases of this type on a contingency fee basis and advance the case costs, and only get paid for their fees and costs out of money they recover for their clients.

Investors who believe they lost money as a result of investment fraud or misconduct may contact the securities lawyers at Peiffer Rosca, Alan Rosca or Joe Peiffer, for a free, no obligation evaluation of their recovery options, at 888-998-0520. 

Alan Rosca (1225 Posts)

Alan is a securities lawyer. He also teaches Securities Regulation at the Cleveland-Marshall College of Law. He focuses his legal practice on complex commercial and financial litigation and arbitration, particularly in the areas of securities and investment fraud. His office is in Cleveland, Ohio.


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