Adam Fritzsche, a stockbroker formerly registered with LPL Financial Corporation (LPL Financial), submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Financial Industry Regulatory Authority (FINRA) in which he was suspended for one year for allegedly making unsuitable recommendations of a speculative, illiquid investment to three elderly retirees.
According to FINRA, Adam Stuart Fritzsche, of Canterbury, Connecticut, recommended that three of his customers purchase an investment in a business development company, which was a speculative, illiquid investment that was suitable only as a long-term investment for those with no need for liquidity. His customers were ages 81, 89, and 61 at the time of Mr. Fritzsche’s recommendations.
FINRA found that these recommendations were unsuitable for the customers and inconsistent with their financial situations and needs. Further, FINRA found that Mr. Fritzsche over-concentrated his customers’ accounts with the investment, allegedly investing 86% of one of his customer’s accounts in a single, high-risk, illiquid investment. Without admitting or denying FINRA’s findings, Adam Fritzsche consented to the entry of FINRA’s findings and was suspended for one year. The suspension is in effect from March 6, 2017 through March 5, 2018.
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 such stockbroker misconduct, FINRA rules require brokerage firms to establish and implement a reasonable supervisory system. The implementation of the rules require supervisors to monitor employees to ensure they comply with federal and state securities laws, securities industry rules and regulations, and the brokerage firm’s own policies and procedures. If broker-dealers and their supervisors fail to establish and implement these protective measures, they may be liable to investors for damages flowing from the misconduct. Therefore, investors who have suffered losses stemming from unsuitable recommendations can bring forth claims to recover damages against broker-dealers, like LPL Financial, which should consistently oversee its brokers’ activities in order to prevent the above-described prohibited conduct.
Have you suffered losses in your LPL Financial account due to your stockbroker’s unsuitable recommendations? Did your stockbroker over-concentrate your investment? 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 LPL Financial stockbrokers who may have engaged in unsuitable trading strategies 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 email@example.com for answers to any of your questions about this blog post and/or any related matter.