Claimants also name former LPL Financial brokers Edward Miller and Antonio Reyna
Two investors were awarded $2.57m in their Financial Industry Regulatory Authority (FINRA) arbitration case against LPL Financial and Financial Resources Group. Also named as respondents but who were not ordered to pay damages are two former ex-LPL financial advisors. Antonio Reyna is now a Securities America broker in Texas, and Edward Bruce Miller is currently registered with Financial Resources Group Investment Services in South Carolina.
This is the investors’ second FINRA arbitration case against LPL Financial. They are alleging unauthorized trading, fraud, breach of fiduciary duty, and breach of contract. Financial Resources Group and LPL were both ordered to pay over $1.6M in compensatory damages and nearly $850K in the claimants’ legal fees. Arbitrators have recommended expunging the case from Reyna’s CRD while Miller continues to deny allegations.
What is unauthorized trading?
Brokers are required to obtain the express permission of an investor before buying or selling securities on their behalf. Unfortunately, unauthorized trading is an all too common occurrence. It can be devastating and feel like a betrayal when a customer loses money on an investment or trade for which they never gave permission. In such instances, the client may be able to pursue damages against their financial advisor and/or the broker-dealer.
Investors previously pursued damages alleging unsuitability
The investors had filed an earlier FINRA arbitration case in 2017 against LPL and Lone Star National Bank in Texas. In a split ruling in 2019, that arbitration panel ordered only LPL Financial to pay the investors $1.5M. The claimants had alleged the following:
- negligent supervision;
- breach of contract;
- unjust enrichment related to allegedly unsuitable investments.
These investments involved offshore investments and non-traded real estate investment trusts (non-traded REITs) that either failed to fit their investment goals or in which at least one of the investors was unqualified to participate.
Any investment recommendation or sale made on behalf of a customer must be suitable according to their investing profile, financial goals, and risk tolerance level. Not all investors are eligible to invest in every type of investment, especially those that require a certain income level threshold or are very complex/high risk.
What is suitability/unsuitability?
Experienced broker misconduct attorneys representing investors against LPL Financial
Shepherd Smith Edwards and Kantas (SSEK Law Firm at investorlawyers.com) represent investors across the United States who have suffered losses because of the misconduct or negligence of an LPL Financial broker. Contact us at (866) 904-5133 today.