The investment lawyers of Gana LLP are investigating a customer complaint brought before the Financial Industry Regulatory Authority (FINRA) against David Ferland (Ferland) working out of the York, Maine office allegedly received a loan of $721,408 from a customer. The providing of loans or selling of notes and other investments outside of a brokerage firm constitutes impermissible private securities transactions – a practice known in the industry as “selling away”. In addition to the loan complaint there have been seven financial disclosures on Ferland’s record indicating that broker had financial trouble.
At this time it unclear the nature and scope of Ferland’s outside business activities and private securities transactions. However, according to Ferland’s public records his outside business activities include real estate business, DL Properties LLC, The Ice House LLC, YFS, LLC, and Independent Insurance Brokering. Often times, brokers sell promissory notes and other investments through side businesses as accountants, lawyers, or insurance agents to clients of those side practices.
Ferland entered the securities industry in 2006. From August 2007 until August 2012, Ferland was associated with Invest Financial Corporation. Since August 2012 Ferland has been associated with Ameriprise Financial Services, Inc.
In the industry the term selling away refers to when a financial advisor solicits investments in companies, promissory notes, or other securities that are not pre-approved by the broker’s affiliated firm. However, even though when these incidents occur the brokerage firm claims ignorance of their advisor’s activities the firm is obligated under the FINRA rules to properly monitor and supervise its employees in order to detect and prevent brokers from offering investments in this fashion. In order to properly supervise their brokers each firm is required to have procedures in order to monitor the activities of each advisor’s activities and interaction with the public. Selling away misconduct often occurs where brokerage firms either fail to put in place a reasonable supervisory system or fail to actually implement that system. Supervisory failures allow brokers to engage in unsupervised misconduct that can include all manner improper conduct including selling away.
In cases of selling away the investor is unaware that the advisor’s investments are improper. In many of these cases the investor will not learn that the broker’s activities were wrongful until after the investment scheme is publicized, the broker is fired or charged by law enforcement, or stops returning client calls altogether.
Investors who have suffered losses may be able recover their losses through securities arbitration. The attorneys at Gana LLP are experienced in representing investors in cases of selling away and brokerage firms failure to supervise their representatives. Our consultations are free of charge and the firm is only compensated if you recover.