FINRA Reportedly Decides Mercer Hicks III Recommended Unsuitable Investments
According to the Financial Industry Regulatory Authority (FINRA), the regulator’s hearing has reportedly rendered a decision on May 19, 2021 wherein broker Mercer Hicks III, of Charlotte, NC, is barred from association with any FINRA member in all capacities and ordered to pay disgorgement to FINRA in the amount of $38,812.60 in commissions received.
Hicks was reportedly named as a respondent in a FINRA complaint alleging that he recommended unsuitable investments to five senior customers (three of whom were widows) to purchase speculative non-traded real estate investment trusts (REITs) and non-traded business development companies (BDCs).
The FINRA complaint alleges that the prospectuses and subscription agreements for these non-traded REITs and non-traded BDCs stated that investing in these securities involved a high degree of risk, was speculative, was not suitable for persons who require immediate liquidity, guaranteed income, or seek short-term investments, and was only appropriate for those investors who could afford a complete loss of their investments.
Apparently, the five senior customers were allegedly not seeking to make speculative, high-risk investments. When Hicks first purportedly recommended non-traded REITs and non-traded BDCs to them, their ages ranged between 73 and 87 years old and all were reportedly retired. The customers’ account documents allegedly indicate that they were seeking either to preserve their capital or for their capital to appreciate.
Some of these customers have reportedly been unable to liquidate the investments to obtain funds that they needed to pay for medical care. In total Hicks purportedly recommended purchases of unsuitable non-traded REITs and non-traded BDCs totaling approximately $665,000. Hicks received a seven percent commission from each sale, totaling approximately $46,550, according to the complaint.
According to his broker profile, Hicks denied all allegations. He was reportedly registered with Southeast Investments, NC Inc. in Charlotte, NC for 7 years and prior to that he worked for Capital Investment Group, Inc. Hicks reportedly has 9 disclosure events on his record including 5 judgments and 3 employment separations.
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The White Law Group is investigating FINRA arbitration cases involving Mercer Hicks III and the liability his employers may have for failure to properly supervise him.
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 Mercer Hicks III, 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.