Securities Expert Witness


Invest Securities Consulting, Inc.





Douglas Schulz, CRCP


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Reviews


The authors have taken the rules and regulations of the brokerage industry and put them in laymen’s terms. -- Professor William C. Tyson, The Wharton School & The Law School of the University of Pennsylvania


The Book, Brokerage Fraud is a must read for all compliance professionals and brokerage firm's compliance and legal departments.

Complinet.com


This book is a timely wake up call to the brokerage industry to clean up its ways. -- George D. Mullen, Vice President UBS PaineWebber


Tracy Stoneman and Douglas Schulz certainly know what Wall Street brokerage firms wish you didn't. -- Evan Cooper, Editor-in-Chief, On Wall Street, Co-Author


This book can save you thousands of dollars and loads of headaches! -- Jordan E. Goodman, author of Everyone's Money Book


Had "Brokerage Fraud" been available to my wife and I eight years ago, it may very well have saved us the fortune we lost to a mercenary industry that promotes itself as caring and responsible, when in fact it cares mostly for itself.


"Brokerage Fraud" is frank and friendly, organized, comprehensive, easy to digest -- and quite unique, too, because the distinguished authors tell all about an autonomous, all-powerful institution that routinely sheers the uninitiated."


". . . I am an attorney and an investor. Yet, I must say that each chapter of 'Brokerage Fraud' brought new information and insight that is invaluable . ."


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WHY HIRE DOUGLAS SCHULZ?

Q: If there is one specific item that separates Mr. Schulz from the other securities experts, what would that be?

A: It is the amount of times that Mr. Schulz has given sworn testimony - approximately 637 times - including FINRA and AAA arbitrations, federal and state courts, and depositions. Becoming a securities expert is as easy as someone hanging out their shingle or creating a website. Every year Mr. Schulz is amazed how many new individuals hold themselves out as securities expert witnesses. The key is experience - how many times has a securities expert witness given actual sworn testimony?  It is in both direct examination, and even more importantly in cross-examination where a securities expert witness earns his pay. Mr. Schulz has heard hundreds of stories about an attorney who has hired a securities expert witness with impressive credentials, but was thoroughly disappointed when his expert melted like an ice cream cone on a hot day on cross-examination.  Mr. Schulz suggests to any individual or attorney who is shopping around for an expert witness to do two things:  A) Ask for some actual proof of how many times the expert has given sworn testimony in litigation, and B) Read some of the testimonials on Mr. Schulz’s website, and contact some of his references, some of who are some of the top-rated securities lawyers in the country, and ask them, “How does Schulz do on both direct and cross-examination?”

 

Q: Does Mr. Schulz have additional experience giving sworn testimony that is not a part of the 637 figure?

A: Yes. Anyone who has had any experience working either for the district attorney or the public defender’s office knows the docket schedule and court appearances is almost a daily occurrence. As a special investigator for the New Mexico State Public Defender’s Office in Albuquerque New Mexico, Mr. Schulz regularly gave both direct and cross-examination sworn testimony. Additionally, when he performed financial investigation and due diligence work for broker-dealers, investment bankers, and merchant bankers, he was often called on to testify in state and federal court.

 

Q: What are some other examples of what separates Mr. Schulz from other securities expert witnesses?

A: There are many firms who have multiple employees or associates that are involved in the firm’s securities work. Often, the lawyer and the client are never fully aware of which individual is conducting the research and analysis for their case. That is not in the best interest of the client. You always want the person that’s going to be giving the sworn testimony to be the very same person who did the work. Since Mr. Schulz is a sole practitioner, that is never an issue.  Also, Mr. Schulz knows many securities experts who have been out of the industry for quite a long time and their expert witness work is often just an adjunct to other work, interests and hobbies. Mr. Schulz has lived, breathed and slept securities, investments, securities regulation and litigation for roughly 30 years. And it goes back even further when you consider he started trading securities fairly actively back in the sixth grade. Mr. Schulz has been been hired in over 1,140 cases, which doesn’t give him the luxury of doing much else other than securities work. But he doesn’t want to do much else. His wife Tracy Pride Stoneman is a nationally recognized securities lawyer who works on securities exclusively. Living on their 160-acre ranch in the mountains in southern Colorado in a very remote location allows them both to work usually 60 to 80 hour weeks. Their cocktail and dinner hours are spent in rigorous conversation and debate on the most topical securities issues of the day, and on each of their cases.

 

Q:  Is Mr. Schulz hired solely as a securities expert witness or does he perform other roles for the lawyers/clients who hire him?

A: Yes, it is common for Mr. Schulz to be hired as a securities litigation/arbitration consultant. Often, Mr. Schulz is contacted by lawyers who don’t have a lot of experience in FINRA arbitrations. This creates a special challenge for that lawyer and his or her client, because the defense counsel is almost always very experienced in this special field of litigation. Of course, his 1,140 cases provide him with an excellent working knowledge of every single aspect of FINRA arbitrations. Additionally, for roughly 25 years, he has worked very closely with his wife who does exclusively securities litigation representing both stockbrokers and investors. For these and other reasons, the less experienced lawyers often are thrilled to find an expert that can wear two hats. In addition to his regular securities expert witness assistance, he often helps the attorney on such subjects as drafting the Statement of Claim, the arbitrator selection process, the document and information discovery process, motions, and briefs, etc.

 

Q: How can Mr. Schulz be of assistance in the discovery process in arbitration?

A: The discovery process in securities arbitration is where each party attempts to obtain all of the key, important documents that they feel will assist in the prosecution or defense of the case. One of the first articles Mr. Schulz wrote, in conjunction with his wife, was on the discovery process (see Securities Arbitration Commentator article dated November, 1990). Twenty-seven years later, the process is still imperfect in that brokerage firms go to great lengths to prevent the production of harmful documents. Mr. Schulz can be a great asset in this area for two reasons. First, he is infinitely familiar with what documents are necessary for any given case. He has seen just about every account form, commission/production run, the various compliance and policy and procedure manuals for the majority of broker-dealers in the country. Second, he is often called upon to draft discovery requests and to assist counsel with arguments for production for the preliminary hearing regarding those requests. 

Q: In addition to Mr. Schulz’s constant securities regulatory research, what else does he do to keep in constant contact with Wall Street and the investment community?

A: Though Mr. Schulz no longer manages money for private individuals and entities, he still manages large sums of money for family accounts.  Additionally, both individually and with other partners, he manages a finance company that lends money on mostly real estate projects such as mezzanine loans, bridge loans, construction loans, and mortgage loans.

Q: Are there other securities activities that Mr. Schulz is involved in that don’t specifically relate to litigation?

A: Mr. Schulz spends time educating investors and attempting to work with regulators in improving the securities markets and environment for investors. He has spoken and testified before numerous state and federal elected representatives. He participated in the Ruder Task Force and often works with investigators on a state, federal and local level.  Mr. Schulz was a key witness for the SEC in their major investigation into the sale of limited partnerships and private placements in the late eighties and early nineties. His most recent article on Power of Attorney accounts at Internet/online brokerage firms is an attempt to prompt the regulators to be more proactive regulating Internet/online brokerage firms.