Alonza Barnett Barred By FINRA Over Failure to Respond to Requests for Information

shutterstock_94332400-300x225According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) advisor Alonza Barnett (Barnett), in March 2017, was barred from the industry by FINRA after FINRA requested documents and information and he failed to request termination of his suspension within three months of the date of the Notice of Suspension drawing an automatic bar from association with any FINRA member in all capacities.  Previously, Barnett was registered with Ameritas Investment Corp. (Ameritas).

In February 2017 a customer filed a complaint alleging that for a 15 year period Barnett engaged in conversion of funds, breach of fiduciary duty and constructive fraud, and violation of the North Carolina Investment Advisors Act.  The claim appears to involve private securities.  The claim alleged $1,750,000 in damages and is currently pending.

At this time it is unclear the extent and scope of Barnett private securities activities.  Barnett CRD lists that he is engaged in fixed insurance products and operates a d/b/a called Dacthler Wealth Management as an outside business activity.  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 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.

Barnett entered the securities industry in 2002.  From June 2010 until December 2016 Barnett was associated with Ameritas out of the firm’s Greensboro, North Carolina office location.

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.