According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker Daniel Drew (Drew), previously associated with North Capital Private Securities Corporation, has at least one disclosable event. These events include one customer complaint, alleging that Drew recommended unsuitable investments in different investment products including debt securities among other allegations and complaints.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $295,000.00 on March 25, 2024.
In their Statement of Claim, as amended, Claimants [REDACTED] (‘REDACTED]’), [REDACTED] (‘[REDACTED]’) and [REDACTED] (‘[REDACTED]’) allege failure to supervise, unsuitable investment recommendations, breach of fiduciary duty and violation of federal and state securities laws in connection with alleged events occurring after [REDACTED], Orion Magnetar Asset Management, LLC’s (entity of [REDACTED]) and Rogers Software Development, Inc. (entity of [REDACTED]) investment in two real estate offerings. [REDACTED] invested $70,000 in FRF 348 Quincy, LLC on March 25, 2018, Orion Magnetar Asset Management, LLC invested $50,000 in FRF 348 Quincy, LLC on April 8, 2018 and $75,000 in FRF 1555 Pacific, LLC on January 5, 2019 and Rogers Software Development, Inc. invested $100,000 in FRF 348 Quincy, LLC on April 13, 2018. Daniel Drew was an associated person and registered representative of the Firm from October 23, 2017 until April 1, 2022. Claimants’ allegations against the Firm are primarily based on allegations of various wrongdoings by the companies managing the underlying properties invested in by FRF 348 Quincy, LLC and FRF 1555 Pacific, LLC, XYZ Group and Cassaforte Limited. It is the Firm’s understanding that XYZ Group and Cassaforte Limited are currently in separate litigation of which the Firm has no part.
Brokers are required to adhere to the SEC’s Regulation Best Interest (Reg BI) standard of care under the Securities Exchange Act of 1934 which establishes a ‘best interest’ standard for broker-dealers and associated persons. This standard applies when brokers make recommendations to retail customer for any securities transaction or investment strategy involving securities, including recommendations of types of accounts. Reg BI is drawn from fiduciary principles that include an obligation to act in the retail investor’s best interest and the broker is prohibited from placing their own interests ahead of the investor’s interest.
There are several different aspects of the rule that brokers must comply with. One of which is the care obligations which requires brokers to form a reasonable belief that their investment advice and recommendations are in the retail investor’s best interest. The care obligations includes three components. First, the advisor must have an understanding of the potential risks, rewards, and costs associated with a product, investment strategy, account type, or series of transactions. Next, the advisor must have a reasonable understanding of the specific retail investor’s investment profile. The customer’s profile information generally includes an investor’s financial situation and needs; investments; assets and debts; marital status; tax status; age; investment time horizon; liquidity needs; risk tolerance; investment experience; investment objectives and financial goals; and any other information the retail investor may disclose in connection with the recommendation or advice. Finally, the financial advisor must use their knowledge of both their reasonable diligence into investment options as well as their knowledge of the investor’s client specific needs to consider reasonably available investment options. Those investment options must allow the broker to determine that there is a reasonable basis that the recommendation is in the retail investor’s best interest.
Brokerage firms and advisors must also understand the features and limitations of various account types as part of meeting Reg BI’s care obligations. Firms typically offer a variety of account options and services with different trading costs, services, such as account and activity monitoring. An advisor’s recommendation as to what type of securities account to open can alter the customers’ overall costs and investment returns. The advisor must determine that the client can benefit from the type of account being recommended to be opened and in the investor’s best interest taking into account the costs, benefits, and needs of the client.
Drew has been in the securities industry for more than 4 years. Drew has been registered as a Broker with North Capital Private Securities Corporation since 2017.
Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. At Gana Weinstein LLP, our attorneys are experienced representing investors who have suffered securities losses due to the mishandling of their accounts. Claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.