Mason Wayne Gann of Dallas, Texas submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Financial Industry Regulatory Authority (FINRA) in which he was fined and suspended for unsuitable recommendations in violation of FINRA Rule 2111 and 2010.
From June 2012 until February 2018, Mason Wayne Gann was registered with Berthel Fisher as a General Securities Representative. According to the FINRA findings, Mr. Gann allegedly recommended and effected a risky options-trading strategy in the account of a senior customer. The FINRA findings stated that Mr. Gann knew the customer had limited income, modest retirement savings, and minimal investment knowledge and lacked a reasonable basis for believing that his recommendations were suitable. The findings also stated that Mr. Gann recommended the customer begin trading options to generate more income in his account which was valued at approximately $205,000. The customer began withdrawing $1500 each month and after two years, his account declined to approximately $120,000 with a loss of more than $12,500 as a direct result of the unsuitable options strategy because he did not produce enough income or gains to offset his withdrawals. In addition to these findings, the combined effect of investment losses and steady withdrawals reduced the customers account to below $20,000 over a 3-year period.
FINRA Rule 2111 provides that a member or an associated person must have a reasonable basis to believe that a recommended transaction or investment strategy involving a security or securities is suitable for the customer, based on the information obtained through the reasonable diligence of the member or associated person to determine the customer’s investment profile. A customer’s investment profile includes such factors as the customer’s age, financial situation and needs, investment objectives, investment experience, and investment time horizon.
Without admitting or denying FINRA’s findings, Mason Wayne Gann was suspended from association with any FINRA member in all capacities for three months. The suspension was in effect from February 3, 2020, through May 2, 2020.
Stockbrokers have been known to engage in many practices that may violate industry and firm rules, practices, and procedures. In order to protect investors from stockbroker misconduct, FINRA rules require brokerage firms to establish and implement a supervisory system. The implementation of these industry rules requires supervisors to monitor their employees to ensure compliance with federal and state securities laws, securities industry rules and regulations, and the brokerage firm’s own policies and procedures. If broker-dealers and/or their supervisors fail to establish and implement these protective measures, they may be liable to investors for damages which flow from the broker’s misconduct. Therefore, investors who have suffered losses stemming from unsuitable recommendations and/or other misconduct by their broker can file claims to recover damages against broker-dealers, like Berthel Fisher, which should consistently oversee its brokers’ activities in order to prevent the above-described misconduct.
Have you suffered losses in your Berthel Fisher account due to unsuitable recommendations by your broker? Was Mason Wayne Gann your stockbroker? 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 Berthel Fisher stockbrokers who may have engaged in broker misconduct and caused investors’ losses.
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 visit our website, www.secatty.com, post a comment, call (800) 732-2889, or email Mr. Pearce at firstname.lastname@example.org for answers to any of your questions about this blog post and/or any related matter.