February 11, 2016
The Financial Industry Regulatory Authority (FINRA) announced today that it has barred two Buffalo-based brokers – Timothy S. Dembski and Walter F. Grenda – from the securities industry for fraud in connection with the sale of a hedge fund, the Prestige Wealth Management Fund, LP. Dembski and Grenda’s misconduct occurred while they were employed with Mid Atlantic Capital Corporation.
FINRA’s investigation found that Dembski and Grenda made material misrepresentations and omissions to lead investors to believe that the hedge fund was a “growth” fund that would be based on a computer algorithm that automatically included risk protections and stop-losses to limit losses in the fund. In fact, the fund was a highly speculative investment, the fund’s Chief Investment Officer had complete control over the investments made, and it was not obligated to follow the computer algorithm. In the last full month that the fund traded, it lost over 80 percent of its value.