Jeffrey Davidson, a registered representative employed by the Stuart, Florida branch of American Portfolios Financial Services, Inc. (American Portfolios), submitted a Letter of Acceptance, Waiver and Consent in which he consented to, but did not admit to or deny, the entry of the Financial Industry Regulatory Authority’s (FINRA) findings that he made unsuitable mutual fund switch recommendations which cost his customers approximately $46,000 in unnecessary sales charges.
According to FINRA, Jeffrey Lee Davidson, of Stuart, Florida, recommended a series of mutual fund switches in 12 customer accounts which were unsuitable for those customers. Mr. Davidson recommended that the customers, one of whom was 97 years old and 5 others were 65 or older, purchase Class A mutual funds, for which they paid commissions and sales charges. He then recommended that they sell the mutual funds within less than one year of the purchase. Mr. Davidson used the funds from the sales of the mutual funds to purchase other mutual funds, for which the customers paid additional commissions and fees.
FINRA’s findings state that Mr. Davidson’s customers paid approximately $46,000 in unnecessary commissions and fees as a result of his unsuitable mutual fund switch recommendations. FINRA fined Mr. Davidson $10,000 and suspended him from association with any FINRA member in any capacity for three months. The suspension is in effect from February 1, 2016 through April 30, 2016.
Stockbrokers, registered representatives, and other financial industry professionals have been known to engage in many types of fraudulent and unlawful behavior which violate industry rules and procedures. In order to protect investors from such misconduct, FINRA rules require broker-dealers to establish and implement a reasonable supervisory system. The implementation of the rules requires supervisors to monitor employees to ensure they comply with federal and state securities laws, securities industry rules and regulations, as well as the brokerage firm’s own policies and procedures. If broker-dealers and their supervisors do not establish and implement these protective measures, they may be a liable to account holders for monetary losses. As a result, account holders who have suffered losses stemming from unsuitable recommendations and/or unnecessary mutual fund switches can file a claim to recover damages against broker-dealers like American Portfolio Financial Services, which have a duty to supervise its employees in order to prevent the above-described misconduct.
Have you suffered losses in your American Portfolio Financial Services account due to your stockbroker’s misconduct? If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation. Mr. Pearce is accepting clients with valid claims against American Portfolio Financial Services stockbrokers for unsuitable recommendations, and/or unnecessary switches and other prohibited broker misconduct.
The most important of investors’ rights is the right to be informed! This Investors’ Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over 40 years, Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities, and investment law issues. The lawyers at our law firm are devoted to protecting investors’ rights throughout the United States and internationally! Please post a comment, call (800) 732-2889, send Mr. Pearce an email at firstname.lastname@example.org, and/or visit our website at www.secatty.com for answers to any of your questions about this blog post and/or any related matter.