Oregon reportedly fines Advisor Gary Dodds for alleged financial exploitation of five elderly clients.
According to an article in Gorge Country Media on March 12, the Oregon Division of Financial Regulation has fined financial advisor Gary Dodds, of Bend, Oregon, and his employer, $220,000 for excessively trading accounts of five elderly seniors. His former employer Raymond James Financial Services, Inc. has reportedly agreed to pay $123,279 in restitution to the alleged victims.
According to the complaint filed by Oregon’s Division of Financial Regulation, Dodds allegedly churned or excessively traded 5 customer accounts from 2016 until 2018.
Further, Dodds purportedly made unsuitable recommendations and sales of securities for his clients and failed to maintain proper documentation of his trading activities, according to the complaint. Raymond James Financial Services apparently was aware of his actions, but did not take adequate corrective steps, according to the order.
According to the complaint, Dodds purportedly executed 103 trades for one elderly client (age 92), earning him $35,000 in commissions. He also allegedly made dozens of trades for four other elderly senior clients.
The Oregon division reportedly issued a cease-and-desist order, and assessed civil penalties of $100,000 against Dodds. As part of the order, Dodds agreed to not apply for any financial services license or registration in Oregon for five years. A civil penalty of $120,000 was also assessed against Raymond James Financial Services, and the company agreed to provide restitution to five seniors totaling $123,379.
According to Dodds’ FINRA broker report, he was registered with Raymond James Financial in Bend, Oregon from 2011 until April 2019 and has one complaint filed against him for allegations of unsuitable investments in 2013. He has reportedly worked in the securities industry for 41 years, but is not currently registered.
Churning or Excessive Trading is Illegal
Churning is when a broker engages in excessive buying and selling (i.e., trading) of securities in a customer’s account without considering the customer’s investment goal, and primarily to generate commissions that benefit the broker. Churning is an illegal practice.
Often churning or excessive trading occurs when a broker has discretionary authority (either actual or implied) of a client’s account, meaning they do not need the clients consent to trade on their behalf. Churning may result in significant losses and exposes the client to unnecessary tax liabilities.
While there is no quantitative measure for churning fraud, brokers must follow FINRA rules intended to prevent such practices.
Filing a Complaint against your Brokerage Firm
The White Law Group continues to file FINRA arbitration cases on behalf of clients who have suffered losses as a result of churning or excessive trading.
When brokers abuse client accounts and conduct transactions that violate securities laws, such as making unsuitable investments recommendations or churning accounts, the brokerage firm they are working with may be liable for investment losses. 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.
If you suffered losses investing with Gary Dodds and Raymond James, the securities attorneys at The White Law Group may be able to help you. Please call 888-637-5510 for a free consultation, or visit us on the web at www.whitesecuritieslaw.com.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois.