First Allied Securities Investigation
The White Law Group is investigating potential securities claims involving broker dealer, First Allied Securities. (CRD#: 32444) and the liability the firm may have for failure to supervise its registered representatives. The firm, headquartered in San Diego, CA, reportedly has 33 disclosure events on its broker record including 18 regulatory events and 15 arbitrations.
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.
Former First Allied Broker Jeffrey Labelle has 12 Customer Complaints
Financial Advisor Jeffrey Labelle has recently been the subject of 6 pending customer complaints for allegations of unsuitable investments with a total of 12 complaints reportedly filed against him in the past 10 years.
Labelle was reportedly registered with First Allied Securities in Sarasota, FL from 2012 until 2018, then moved to LPL Financial for two years.
First Allied Advisor Sean A. Brady Barred from Securities Industry
June 2018 FINRA bars Sean Brady of First Allied Securities in St. Louis, MO for alleged failure to provide testimony in a FINRA’s investigation. The investigation was in connection with possible sales practice violations committed by Brady while he was registered with First Allied.
His FINRA BrokerCheck report states that Brady was employed by First Allied Securities in St. Louis, MO from May 2008 until he was fired in October 2017. Brady reportedly has 9 customer disputes on his broker report. Allegations include: unsuitable recommendations, misrepresentations & omissions, and completing paperwork without customers’ permission.
FINRA Censures First Allied Securities for Mutual Fund Sales charge waivers
August 2017 – First Allied Securities, Inc. was censured and agreed to pay restitution to eligible customers, which is estimated to total approximately $876,915 (the amount eligible customers were overcharged, with interest) for mutual fund sales-charge waivers.
First Allied Securities allegedly disadvantaged certain retirement plan and charitable organization customers that were eligible to purchase Class A shares in certain mutual funds without a front-end sales charge.
The findings stated that these eligible customers were instead sold Class A shares with a frontend sales charge or Class B or C shares with back-end sales charges and higher ongoing fees and expenses.
FINRA Sanctions First Allied and Seven other Firms for Failure to Supervise L-share annuities
October 2016 – First Allied was one of eight firms that had to pay restitution for failing to supervise the sales of variable annuities products, according to a Letter of Acceptance Waiver and Consent. Cetera Advisors, First Allied, Summit Brokerage and VSR will collectively pay customers at least $4.5 million and Voya was ordered to pay its customers at close to $1.8 million.
FINRA stated that L-share annuities could pay greater compensation to the firms and registered representatives than more traditional share classes. The variable annuities in question were L-share annuities that are considered potentially incompatible, complex and expensive long-term minimum-income and withdrawal riders, according to the document.
FINRA said such complex investment products are only suitable for a narrow class of customers, and that the firms have not provided its advisers with reasonable guidance on discerning this class of customers.
First Allied Securities Lawsuits
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.
If you have concerns regarding investments you purchased through First Allied Securities the securities attorneys at The White Law Group may be able to help you. Please call the offices at 888-637-5510 for a free consultation.
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.
For more information on The White Law Group, visit www.whitesecuritieslaw.com.