The White Law Group is investigating potential securities claims involving Crown Capital Securities (CRD #6312, Orange, CA)
Crown Capital Securities, headquartered in Orange, CA, is a national financial advisory firm. According to its FINRA Broker Report, the firm reportedly has 7 disclosure events on its broker record including 5 regulatory events and 2 arbitrations.
FINRA Censures and Fines Crown Capital Securities
June 2019 – The Financial Industry Regulatory Authority (FINRA) reportedly sanctioned Crown Capital Securities LP with a censure and fine of $75,000 after it failed to establish and maintain a supervisory system, to monitor mutual fund switches.
The firm reportedly failed to reasonably supervise short-term switches of Class A mutual fund shares conducted by two firm registered representatives.
Crown Capital’s supervisory system apparently relied solely upon the representative to alert the firm of a mutual fund switch.
As a result, mutual fund switch transactions by the representatives in this matter allegedly escaped supervisory scrutiny by the firm. The firm reportedly compensated the customers who sustained losses due to the unsuitable mutual fund switches conducted by the two representatives, paying a total of approximately $395,000 in restitution.
Broker Misconduct and Customer Complaints
There have been several cases of registered representatives employed by Crown Capital Securities who were allegedly involved in broker misconduct and fraudulent activities.
February 2020 – FINRA barred former Crown Capital advisor Martin David Batstone (Marty Batstone) alleging violation of FINRA Rules 2150 and 2010 for conversion of customer funds.
He reportedly has 6 customer complaints on his broker check record, according to FINRA. Allegations include unsuitable investment recommendations, among others.
January 2016 – Former Crown Capital advisor Eric Kuchel (CRD #4118500, Yorba Linda, California) was barred from association with any FINRA member in any capacity. The sanction was based on findings that Kuchel allegedly failed to provide complete testimony to FINRA during the course of an investigation into mutual fund transactions. FINRA’s findings stated that Kuchel did not substantially comply with the request for his testimony and failed to appear for his rescheduled testimony.
Kuchel reportedly has five customer complaints filed against him. Allegations include unauthorized trading, unsuitable investments, and negligence among others.
All broker-dealers have a responsibility to adequately supervise its employees. They must ensure the necessary procedures and systems to detect misconduct. Brokerage firms that fail to monitor the business activities of their employees may be liable for investment losses due to negligent supervision for the misconduct of their employees.
When brokers violate securities laws, such as making unsuitable investments, the brokerage firm they are working with may be liable for investment losses through FINRA Arbitration.
Free Consultation with a Securities Attorney
The foregoing information, which is all publicly available, is being provided by The White Law Group. The White Law Group is a national securities arbitration, securities fraud, and investor protection law firm with offices in Chicago, Illinois.
If you have concerns regarding investments you purchased through Crown Capital Securities and would like to speak with a securities attorney, please call The White Law Group at 888-637-5510.
For more information on The White Law Group, visit www.whitesecuritieslaw.com.