Former Cetera Advisor Networks Broker Permanently Barred by FINRA for Failing to Respond to Investigation into Unsuitable Trading

Former Cetera Advisor Networks broker Mark Koehler has been barred by the Financial Industry Regulatory Authority (FINRA) for refusing to produce information and documents requested by FINRA in connection with an investigation into unsuitable trading in a senior customer’s accounts, including short-term mutual fund switching and excessive trading. FINRA began an investigation in April 2014, upon receipt of a tip that Mark Charles Koehler, of Chadds Ford, Pennsylvania, had engaged in unsuitable trading in the accounts of a senior customer.  In the course of its investigation, FINRA reviewed trading in other of Mr. Koehler’s customer accounts and sought to investigate the following:  whether Mr. Koehler engaged in unsuitable short-term mutual fund switching and excessive trading; whether he placed undue influence on a customer before her death; and whether Mr. Koehler failed to disclose his status as beneficiary in the same customer’s will.

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Cetera Advisor Networks to Pay More Than $1.9 Million in Restitution for Mutual Fund Overcharges

Cetera Advisor Networks has agreed to pay more than $1.9 million in restitution to customers who were overcharged in certain mutual fund purchases.  According to the Financial Industry Regulatory Authority (FINRA), between July 1, 2009 and January 1, 2017, Cetera Advisor Networks disadvantaged certain retirement plan and charitable organization customers that were eligible to purchase Class A shares of certain mutual funds without a front-end sales charge.  The customers were instead sold Class A shares with a front-end sales charge or Class B or C shares with back-end sales charges and higher ongoing fees and expenses. 

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Cetera Advisor Networks Fined for Variable Annuity Supervisory Failures

Cetera Advisor Networks, LLC, headquartered in El Segundo, CA, submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Financial Industry Regulatory Authority (FINRA) for failing to adequately supervise the sales of variable annuities, specifically L-share variable annuities. Registered with FINRA since 1983, Cetera Advisor Networks currently has 3,048 registered representatives and 1,209 branch offices.  FINRA found that from January 2013 to December 2014, Cetera Advisor Networks failed to establish, maintain, and enforce an adequate supervisory system to identify red flags related to the sale of L-share variable annuities.  Additionally, FINRA found that Cetera Advisor Networks failed to provide its registered representatives with proper training and guidance on suitability considerations for these variable annuities.  According to FINRA, the L-share annuities are a complex investment product that is only suitable for a narrow class of investors and that Cetera Advisor Networks allegedly failed to provide its registered representatives with appropriate guidance to discern this class of investor.

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