Michael Kazacos and David Isabella Morgan Stanley

On behalf of hundreds of Eastman Kodak Co. and Xerox Corp. retirees the Pearl Law Firm filed arbitration proceedings and multimillion-dollar class-action suits targeting Morgan Stanley & Co. Inc. and two Rochester-area securities brokers for allegedly mishandling the retirees’ investments.

Targeted along with Morgan Stanley were brokers Michael Kazacos and David Isabella. Kazacos, a former Morgan Stanley vice president in Rochester New York and a certified financial planner, had run highly publicized retirement seminars targeting Kodak early retirees throughout much of the 1990s. Isabella, himself a Xerox retiree, had managed investment accounts for several ex-Xerox workers.

In these proceedings, we actions alleged that the brokers had falsely promised workers that by using a federal tax provision they could set up investment accounts that would yield annual dividends of 10 percent while growing or maintaining principal amounts.

To the contrary, Kazacos’ and Isabella’s clients’ accounts had dwindled, shrinking from six-figure to five-figure sums and forcing many who had retired on the brokers’ assurances to go back to work at low-paying jobs. Kazacos and Isabella typically targeted financially unsophisticated blue-collar workers in their 50s, inducing many who otherwise might have kept working to retire early.

In addition to the class-actions filed today, Morgan Stanley, Isabella, and Kazacos were targeted by a probe by the Financial Industry Regulatory Authority (FINRA) which resulted in both Isabella and Kazacos being barred from the industry and fining Morgan Stanley $700,000.

ISABELLA OFFER OF SETTLEMENT
KAZCOS BAR DOCUMENT

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