Advisor David Volpe Subject to Regulatory Bar Over Unauthorized Securities Sales

shutterstock_182004416-300x200The law offices of Gana Weinstein LLP are currently investigating claims that advisor David Volpe (Volpe) engaged in private securities transactions and borrowed customer funds that were not approved by his brokerage firm.  Volpe, formerly registered with First Financial Equity Corporation (First Financial) and LPL Financial LLC (LPL Financial) was subject to an investigation by The Financial Industry Regulatory Authority (FINRA) over these allegations.  In addition, Volpe disclosed one bankruptcy filing, and two employment terminations for cause.

In August 2019 FINRA alleged that Volpe consented to the sanctions resulting in a bar from the industry and to the entry of findings that Volpe refused to produce information and documents requested by FINRA in connection with an investigation into whether he engaged in a private securities transaction or borrowed funds from a customer.

In April 2019 Volpe was discharged by First Financial after the firm claimed that Volpe failed to notify firm of private securities transaction involvement and violation of firm policy regarding borrowing funds from a client.

In December 2018 Volpe was discharged by LPL Financial after the firm claimed that Volpe violated the firm’s private securities transactions policy for involvement in capital raising efforts without prior disclosure.

Our law firm has significant experience bringing cases on behalf of defrauded victims when their advisors engage in receiving loans from clients or selling fraudulent securities sales through OBAs.  The sale of unapproved investment products – is a practice known in the industry as “selling away” – a serious violation of the securities laws.  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.  Sometimes those investments have some legitimacy but often times these types of investments can end up being Ponzi schemes or the advisor can be engaging in the conversion of funds.

When advisors convert or misappropriate funds they often create businesses or other vehicles to serve as a cover for the theft of funds.  However, federal securities laws and the FINRA rules require firms to 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.

Volpe entered the securities industry in 1996.  From January 2009 until November 2017 Volpe was registered with National Planning Corporation.  From November 2017 until December 2018 Volpe was registered with LPL Financial.  Finally, from January 2019 until May 2019 Volpe was associated with First Financial out of the firm’s Scottsdale, Arizona office location.

Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. Investors may be able recover their losses through securities arbitration.  The attorneys at Gana Weinstein 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.