Schwartz Law is currently investigating claims against Ricky Alan Mantei located in Columbia, South Carolina. Mantei is the founder, owner, and branch manager of Mantei & Associates, which is also known as COLA Wealth Advisors. Mantei is currently associated with Centaurus Financial. and was previously registered with JP Turner, which is no longer in business. Mantei was the subject of three (3) regulatory events, thirty-eight (38) separate customer disputes and has three (3) pending customer disputes.
In February of 2023 the Securities Commissioner of South Carolina, the South Carolina Department of Insurance and the Securities and Exchange Commission (“SEC”) issued sanctions against Mantei, including a fine of more than $200,000, a suspension and a cease and desist for various regulatory violations. South Carolina regulators alleged that Mantei recommended Variable Interest Rate Structured Products (“VRSPs”) and corporate bonds to retail customers for which an appropriate overall evaluation of the financial profile was not conducted. Mantei was working as branch manager of his office allegedly failed to reasonably supervise the brokers which he was charged with overseeing. Mantei also entered into an Order with the SEC related to allegations of his failure to supervise the sale of VRSPs to clients.
The SEC alleged that the registered representatives that Mantei supervised recommended a total of 155 VRSPs to ninety-four clients for whom the securities were unsuitable based on each individual customer’s financial situation and needs, as reflected by their age, annual income, net worth, risk tolerance, investment objectives, liquidity needs, investment time horizons, and investment experience.
What are Variable Interest Rate Structured Products?
The VRSPs at issue were complex, structured securities with maturity periods of fifteen years (15) or more issued by large well-known financial institutions. The VRSPs initially offer guaranteed periodic fixed-interest rate payments, typically for one (1) to three (3) years. After the fixed- interest rate periods end, however, the VRSPs switch to periodic variable-interest rate payments. The variable interest rate payments are calculated based on formulas tied to differences in Constant Maturity Swap (“CMS”) rates for long-term and short-term U.S. Treasury obligations, typically referred to as the “yield curve.” Accordingly, during the variable-interest rate period, depending on the performance of the CMS rates, investors are not guaranteed to receive any further interest payments from the VRSPs.
Moreover, the VRSPs include an additional contingency before investors can be paid any interest during the variable-interest rate period, which creates further complexity and risk. In particular, regardless of the performance of the CMS rates, the VRSPs only make periodic variable-interest rate payments if one or more referenced indexes, such as the S&P 500 and/or Russell 2000 stock indexes, do not decline more than a specified percentage (in most cases, 50%). The prospectuses for the recommended VRSPs at issue expressly disclosed the risk of non-payment of interest, stating, for example, that “there can be no assurance that [investors] will receive a contingent interest payment on any interest payment date” and that “the securities are not a suitable investment for investors who require regular fixed income payments, since the contingent interest payments are variable and may be zero.”
Investigation of Ricky Alan Mantei
If you have suffered losses as a result of Ricky Alan Mantei, we would like to hear from you. We are currently investigating claims on behalf of clients who were sold unsuitable Variable Interest Rate Structured Products. If you have had a similar experience, we would like to hear from you as your experience may assist us in the adjudication of claims against Mantei, Mantei & Associates, COLA Wealth Advisor and/or Centaurus Financial. The Schwartz Law Firm represents investors in claims against financial advisors and their firms. If you have questions about your potential claim or need assistance from an investment fraud lawyer, please contact us at 866-618-0545 or email Matthew Schwartz directly at [email protected].