Ex-Western International Securities Broker Megurditch Patatian Allegedly Unsuitably Recommended Non-Traded REITs to Investors

FINRA Claims Former Financial Advisor Also Cost Investors Over Variable Annuities 

The Financial Industry Regulatory Authority (FINRA) has filed a complaint accusing ex-Western International Securities registered representative Megurditch Mike Patatian of unsuitably recommending to 59 customers that they purchase non-traded real estate investment trusts (non-traded REITs). According to the self-regulatory organization (SRO), Patatian lacked reasonable grounds to make 81 recommendations to these customers.  Not only that, but for four of the non-traded REIT sales at issue, the ex-financial advisor recommended that they surrender their variable annuities (VAs), which caused them to have to pay surrender fees and incur taxes. 

These purportedly unsuitable recommendations which caused investors to lose money, occurred while Patatian was with Western International Securities in Westlake Village, CA. (After leaving that brokerage firm in 2020, he became a Supreme Alliance broker for less than a year in Charlotte, North Carolina.) 

Our Non-traded REIT attorneys at Shepherd Smith Edwards and Kantas (SSEK Law Firm at investorlawyers.com) are looking into claims of losses by investors who have worked with Megurditch Patatian or other Western International Securities financial advisors. Call (800) 259-9010 today.

Failure to Conduct Due Diligence & Inflating Customer Net Worth

In its complaint, brought in early 2021, FINRA claims that Patatian did not have a proper understanding of the “basic risks and features” involving non-traded real estate investment trusts.  He also allegedly did not conduct the proper due diligence in order to better understand this product, which tends to pay brokers high commissions for the sales. 

The SRO notes that six of the customers to whom Patatian recommended non-traded REITs had liquidity concerns, which means that it made no sense to recommend this kind of illiquid type of investment to them. 

Patatian also recommended that some customers exchange existing variable annuities for other VAs. FINRA believes that the ex-broker did not understand how much buying new variable annuities would cost investors or that a premium death benefit’s return is not considered standard for every variable annuity.

Patatian is accused of impersonating at least one customer without their knowledge or permission while talking on the phone with an insurance company to get the surrender fee and contract value for a variable annuity. He also allegedly both overstated the net worths of customers and inflated their investing experience. 

FINRA said that in 26 occasions of exaggerating clients’ experience, this allowed Patatian to get around the limits of REIT issuers and the state of California, which restrict an investor’s total real estate investment trust purchase to 10% of their net worth. For example, Patatian inflated one customer’s net worth from $180K to $1M on their client disclosure.

Patatian was Fired Or Allowed to Resign by Three Broker-Dealers

During his 21 years in the industry, Patatian used to be a registered broker at three other firms, including Cuso Financial, WM Financial, and Crowell, Weedon & Co. 

Cuso Financial let Patatian resign in 2013 as did WM Financial in 2004. He also may have worked with but was then allowed to resign by Newbridge Securities.  

 There are 13 disclosures on Patatian’s BrokerCheck record. Nine of them are customer disputes that were either settled or denied.

Knowledgeable FINRA Arbitration Law Firm 

SSEK Law Firm represents investors in recovering damages from the brokerage firms and financial advisors responsible for their losses. We have been fighting for investors for more than 30 years and have recovered many millions on their behalf.  

Call our California non-traded REIT attorneys (619) 550-4847. You can also reach out to SSEK Law Firm throughout the US by calling (800) 259-9010 today.

Contact Information