Charles Frieda, a former registered representative with Wells Fargo Clearing Services, LLC (f/k/a Wells Fargo Advisors, LLC), submitted a Letter of Acceptance, Waiver and Consent (AWC) in which he was barred by the Financial Industry Regulatory Authority (FINRA) for recommending an investment strategy which was over-concentrated in energy-sector securities and unsuitable for his clients. FINRA found that Mr. Frieda’s unsuitable recommendations resulted in millions of dollars in losses to his clients.
FINRA found that Charles Henry Frieda (along with another Wells Fargo representative) recommended an over-concentration of energy-sector securities, some of which were speculative, to more than 50 customers. Because of the speculative nature of the energy-sector securities, the volatility of the energy market, and the highly over-concentrated levels in the clients’ accounts, Mr. Frieda’s customers were exposed to significant losses. According to FINRA, Mr. Frieda failed to properly consider his customers’ investment profiles, including their investment experience, risk tolerance, investment time horizon, net worth, and liquidity needs. Even when the energy market began a downturn in 2015, Mr. Frieda continued to unsuitably recommend that his clients adhere to his investment strategy. Due to his highly unsuitable recommendations, Mr. Frieda’s customers suffered millions of dollars in aggregate losses. Without admitting FINRA’s findings, Charles H. Frieda, of Anaheim, California, was barred from association with any FINRA member in all capacities.