By PAUL STONE
The Palestine Herald
May 29, 2008 03:18 am
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A couple who formerly resided in Palestine has been awarded almost $1.32 million by a panel of arbitrators in connection with their claims against former Palestine resident and stockbroker Brent Lemons.
A panel of arbitrators for the Financial Industry Regulatory Authority (formerly the National Association of Securities Dealers Inc.) awarded Tammy and Cindy Mays, former Palestine residents who now live in Tyler, a total of $1,318,042 following a hearing in Dallas last month.
Bryan Forman, the Mays’ Tyler-based attorney, said his clients entrusted all of their money to Lemons, but that he failed to advise them about the risks in their accounts; lied about the value of their accounts; and invested their money in risky investments on margin without their knowledge or consent.
Additionally, Lemons misappropriated their funds for his own personal benefit, according to Forman.
“Tammy and Cindy (Mays) trusted Lemons as their longtime friend and adviser and unfortunately Lemons’ selfish and culpable conduct cost them the money that was intended to help them take care of their family and their children for many, many years,” Forman said.
The Tyler attorney said he has “no indication” that Lemons is going to be able to financially satisfy the panel’s award to the Mays.
“What I don’t know is whether Mr. Lemons has assets that can be collected against,” said Forman during an interview Wednesday with the Herald-Press. “...I don’t know whether Mr. Lemons has secreted away any assets.
Lemons, who is no longer working as a stockbroker, also faces federal criminal charges in connection with his alleged mishandling of customers’ investments.
In March, the 51-year-old Lemons, who was formerly employed by A.G. Edwards & Sons Inc. in Palestine, was indicted on 19 criminal counts by a Tyler federal grand jury, including seven counts of conducting transactions with criminally derived funds; five counts of bank fraud; five counts of misapplication of funds by a bank employee; one count of wire fraud; and one count of interstate transport of stolen funds.
His trial has been set for Sept. 2, with U.S. District Judge Michael H. Schneider presiding.
If convicted, Lemons faces up to 30 years in federal prison and a fine of up to $1 million. He is also being investigated by the Internal Revenue Service and the FBI.
The federal government is also seeking forfeiture of $1.55 million in cash proceeds.
Lemons worked for A.G. Edwards in Palestine during the 1980s and ‘90s before moving to Tyler in 1997. He continued to work for A.G. Edwards in Tyler until accepting a position with Bank of America in 2004.
Forman, who is also representing other “claimants” in their claims against the same broker, said the Mays and his other clients came to know Lemons during his years in Palestine.
“All of them are Palestine relationships that bridged over into Tyler when Brent moved to Tyler,” Forman said. “...It is my opinion that of the people I’m representing they were longtime friends and associates and trusted Brent explicitly with their money.”
Lemons reportedly is suffering from several health problems, including a heart condition, and taking almost a dozen prescriptions, according to his Dallas attorney John Teakell.
The offenses alleged in the criminal indictment occurred between May 2005 and March 2007 when Lemons was president of the Tyler Market at Bank of America. In its 28-page indictment, the federal government claims that Lemons “did knowingly devise and intend to devise a scheme and artifice to obtain money, funds, and assets under the custody and control of a financial institution,” specifically taking almost $410,000 from the account of bank customer, Venna C. Davis Stubbs.
Lemons now lives in Arlington. During his time in both Palestine and Tyler, he was heavily involved in a number of civic, non-profit and community organizations.
“I think Brent Lemons gained people’s trust; he gained control of their accounts; and then he breached their trust,” said Forman, who declined to comment on any pending litigation or arbitration.
Lemons has been free on a personal recognizance bond after pleading not guilty to each of the federal counts two months ago.
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Paul Stone may be contacted via e-mail at pstone@palestineherald.com
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