Former NFL cornerback Asante Samuel and Mega Millions lottery winner James Groves are jointly seeking $7.8 million in damages against Morgan Stanley related to investment recommendations made by a now-barred broker, according to regulatory filings.
It's the latest case to stem from the alleged misconduct of ex-wirehouse adviser and nightclub owner Aaron Parthemer, who is also at the center of a second case recently filed by a group of NFL players against Morgan Stanley.
Parthemer was barred from the industry in 2015 by FINRA. The regulator accused Parthemer of engaging in several undisclosed outside business activities, soliciting clients to invest in the nightclub without his employer's permission and providing false information to FINRA among other misconduct.
Samuel and Groves filed their claims in FINRA arbitration in July, according to a copy of Parthemer's CRD. From 2003 to 2013, Samuel played for several NFL teams, including the New England Patriots and Philadelphia Eagles. Groves won $168 million in the Mega Millions lottery in 2009.
Parthemer, who was based in Fort Lauderdale, Fla., worked at Morgan Stanley and predecessor firm Smith Barney from 2006 to 2011, according to FINRA BrokerCheck records. He left to join Wells Fargo Advisors.
A Morgan Stanley spokeswoman said Parthemer failed to disclose his outside business activities to the firm.
"The nightclub issue had nothing to do with Morgan Stanley,” the spokeswoman said. “Asante Samuel owned the South Beach nightclub and eventually the club closed as a result of the realities of business world and competition in the South Beach club scene. His late conceived claims that this is somehow related to Morgan Stanley is without merit."
Meanwhile, in August, Wells Fargo settled a case brought by Samuel and Groves related to Parthemer's actions while employed at the wirehouse, paying the former clients $1.5 million, according to regulatory filings. Samuel and Groves originally sought $3.5 million.
The wirehouse declined to comment. According to a note in Parthemer's CRD, Wells Fargo said it did not admit any liability and settled the matter "to avoid further arbitration."
Matthew Johnson, an attorney at Denver-based law firm Wheeler Trigg O’Donnell, is representing the two ex-clients, as well as the group of NFL players also seeking damages against Morgan Stanley. That second case is for unspecified damages, according to Parthemer's CRD. Johnson declined to comment on both cases while they are pending.
Neither Parthemer nor his attorney could be reached for comment.
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August 11 -
Ash Narayan "secretly siphon[ed] millions of dollars from accounts he managed for professional athletes," the SEC alleged.
June 21 -
The case centered on the supervision of a now-barred broker, whose misconduct included encouraging athletes to invest in a Miami Beach nightclub and sending baskets of tequila to pro sports teams, according to FINRA.
May 24 -
Parthemer worked with pro athletes and frequented South Beach clubs with rap stars.
April 18
TEQUILA BASKETS
This is not the first case related to Parthemer that Morgan has faced. In May,
Parthemer was a high profile broker, courting sports stars and hip-hop artists as his clients, according to regulatory filings.
His undisclosed businesses included owning a nightclub in Miami Beach, Fla., according to FINRA's disciplinary report, which the regulator filed when it barred him from the industry.
Parthemer solicited investments in the club from his clients, some of whom were NFL and NBA players. They were also clients of Wells Fargo and Morgan Stanley, the regulator says.
In 2011, he was involved in promoting a brand of tequila. His marketing efforts included sending gift baskets of the Mexican liquor to several NFL and NBA teams, according to FINRA. He did not disclose these outside businesses to his employers.
Without admitting nor denying the findings, Parthemer consented to the bar, according to a the report.
In April, the CFP Board
Parthemer filed for Chapter 11 bankruptcy in November 2015. In February 2016, Wells Fargo Advisors filed a suit against Parthemer seeking $2.1 million in promissory notes that the firm says Parthemer owes but has not paid. The wirehouse gave Parthemer $1.5 million when he joined Wells Fargo from Morgan Stanley in October 2011, according to court filings.
