The investment lawyers of Gana LLP are investigating Ameriprise Financial Services, Inc.’s (Ameriprise) termination of former broker Stephen Mosley (Mosley) working out of the Lake Havasu City, Arizona office. Ameriprise terminated Mosley in November 2016. According to the broker’s Financial Industry Regulatory Authority (FINRA) BrokerCheck filing the firm stated that Mosley “was terminated for compliance policy violations related to complying with disciplinary action and heightened supervision, soliciting a prohibited security and suitability of a transaction.” Mosley also has two customer complaints listed on his record. No other disclosure concerning the extent and nature of the activity is disclosed.
However, Mosley has disclosed several outside business activities including his d/b/a Wisdom & Wealth Corp. Mosley has also disclosed entities including LP Prop, LLC – a real estate holding company. It is unclear at this time if Mosley’s activities involve any of these disclosed entities.
The providing of loans, selling of promissory notes, or recommending investments outside of the firm constitutes impermissible private securities transactions – a practice known in the industry as “selling away”. Often times, brokers sell promissory notes and other investments through side businesses as accountants, lawyers, real estate agents, or insurance agents to clients of those side practices.
Mosley entered the securities industry in 2007. From January 2007 until June 2010, Mosley was associated with NYLife Securities LLC. Then, from January 2011 until June 2011 Mosley was associated with Hartford Equity Sales Company Inc. From June 2011 until September 2013 Mosley was registered with Edward Jones. Finally, from October 2013 until December 2016 Mosley was associated with Ameriprise out of the firm’s Lake Havasu City, Arizona office location.
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. A brokerage firm’s claim of ignorance of their advisor’s activities is not a proper defense to their agent’s activities. Brokerage firms are obligated under the FINRA rules to properly monitor and supervise its employees in order to detect and prevent brokers from offering investments away from the firm and respond to red flags of potential misconduct. 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.