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FINRA Bars Former LPL Financial Broker Rhett Bedwell Following Ponzi Fraud Allegations

SSEK Law Firm Is Representing Arkansas Retiree In $500K Customer Dispute 

The Financial Industry Regulatory Authority (FINRA) has barred ex-LPL Financial stockbroker, Rhett Douglas Bedwell after he refused to provide key documents into the self-regulatory organization’s probe into allegations that he invested funds from a client’s IRA in a Ponzi scheme. According to LinkedIn, Bedwell, who is based in Bentonville, Arkansas, is president and a financial advisor at Homestead Wealth Management.

Shepherd Smith Edwards and Kantas (SSEK Law Firm at investorlawyers.com) is representing this customer, an Arkansas retiree, in his $500K broker-dealer negligence case against the brokerage firm. If you are another investor who lost money while working with ex-LPL Financial broker Rhett Bedwell or another registered representative from that firm, contact us today to request your free, no-obligation case assessment. 

Ponzi Scam Involved Small World Capital and Graysail Capital 

Rhett Bedwell is no longer a registered broker or investment advisor. He began working in the industry in 2009, including previously at Arvest Wealth Management, Edward Jones, Investment Professionals, and Wells Fargo Advisors.

In 2019 LPL Financial, where Bedwell was a registered representative since 2017, filed a Form U5 Termination Notice noting that he had voluntarily resigned. 

The broker-dealer later submitted an amendment stating that a claimant had accused Bedwell of investing his money in a Ponzi scheme. In a second amendment, LPL Financial said that it had conducted an internal review after customers had brought allegations against Bedwell. 

In the Arkansas retiree’s FINRA arbitration case, the claimant contends that Rhett Bedwell unsuitably recommended his money in a Ponzi scam involving Small World Capital and Graysail Capital. He also is alleging misrepresentations and omissions, failure to supervise, unauthorized transactions, negligence, broker fraud, and other breaches of duty. 

Alabama Securities Commission Rules Small World Capital is a Ponzi Scam

The Alabama Securities Commission has called Small World Capital a Ponzi scam. Graysail Capital appears to have lent money to Small World Capital. 

Bedwell, who told the senior investor that his money would be safe, instead appears to have forged documents, investing $230K of the claimant’s retiree money in the scheme. That money is now gone. 

On February 10, 2021, Bedwell signed FINRA’s Acceptance, Waiver, and Consent letter for the bar. He is not, however, admitting to or denying the SRO’s findings.  

Supervisory Deficiencies Involving LPL Financial 

LPL Financial had an obligation to properly supervise Bedwell and his management of the retiree’s money. Because the independent broker-dealer’s registered representatives don’t receive much in-person oversight, it can be hard for the firm to properly oversee its activities. 

This setup, however, does not exempt LPL Financial from its supervisory duties. It can be held liable for customers’ resulting losses even if they were unaware of their brokers’ negligent or fraudulent actions. 

SSEK Law Firm has represented LPL customers in their investor claims against the broker-dealer. Contact our failure to supervise attorneys today at (800) 259-9010. Unfortunately, lack of proper oversight by brokerage firms is one of the most common reasons that investors suffer unnecessary losses.

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