Larry Michael Crabtree, a former Edmond, Oklahoma based registered representative with WFG Investments, Inc. consented to, but did not admit to or deny, the sanction and the entry of the Financial Industry Regulatory Authority’s (FINRA) findings that he exercised discretion in a customer’s account to make unsuitable securities purchases which resulted in substantial losses to his customer.
FINRA found that Larry Crabtree, of Edmond Oklahoma, exercised discretion in the IRA account of an elderly retiree with known health problems, limited income and limited liquid assets. Mr. Crabtree made purchases of securities on his customer’s behalf, one of which was a highly leveraged oil and gas exploration company, which resulted in an almost complete loss when that oil and gas company declared bankruptcy. Mr. Crabtree also exercised discretionary trades in certain customer accounts, neglecting to get the customers’ or WFG Investment’s prior written authorization as required by FINRA Rule 2010. Consequently, Mr. Crabtree was suspended from association with any FINRA member in any capacity for six months. Due to his financial status, no monetary sanctions were imposed.
Stockbrokers and other financial industry professionals have been known to engage in many types of fraudulent and unlawful behavior, such as unsuitable recommendations and unauthorized trades, which violate industry rules 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 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 held liable to investors for losses flowing from the misconduct. As a result, investors who have suffered losses stemming from a stockbroker or registered representative’s unsuitable account recommendations or unauthorized trades can bring forth claims to recover damages against brokerage firms like WFG Investments, which have a duty to supervise its employees in order to prevent broker misconduct.
Have you suffered losses in your WFG Investments account due to your broker’s unsuitable trades or unauthorized transactions? 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 WFG Investments stockbrokers for exercising discretionary trades and other types of stockbroker 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 email@example.com, 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.