Securities Lawyers Blog
According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker Andre Labarbera (Labarbera), previously associated with Titus Rockefeller, LLC, has at least 2 disclosable events. These events include one customer complaint, one regulatory event, alleging that Labarbera recommended unsuitable investments in different investment products including debt securities among other allegations and complaints.
FINRA BrokerCheck shows a final customer complaint on August 20, 2021.
Respondent Labarbera failed to comply with an arbitration award or settlement agreement or to satisfactorily respond to a FINRA request to provide information concerning the status of compliance.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $23,793.00 on February 15, 2020.
Claimant alleges unsuitability, overconcentration, churning, breach of fiduciary duty and fraudulent misrepresentation. Claimant’s attorney has neglected to point out that his client [REDACTED] is a professional gambler and has been so for decades betting thousands of dollars in individual gambling situations on college and professional football games with accounts set up both in his name and his grandson’s name (they are partners) in Las Vegas, on-line gambling websites, off shore and with professional bookmakers which in the United States constitutes an illegal activity punishable both by fines and imprisonment. What makes Claimant a professional is that he wins regularly with his sports betting activities. Claimant [REDACTED] engaged both his broker and others at the firm regularly in conversation where he regaled us with his exploits as a gambler. We monitored his bets because we found it implausible that an individual could regularly win at betting. [REDACTED] brought the same concentration to his investments in the stock market where he understood the pluses and minuses of all trades that he engaged in. He was in regular contact with his broker, received trade confirmations and month end statements regularly and NEVER COMPLAINED either in writing or verbally to his broker or any other person at the firm during the several years that his account was lodged at the firm. His account was not a fiduciary account and therefore there was no breach of fiduciary duty. All trades were suitable as to his investment objectives. The Claimant signed a trading letter indicating he wanted to trade and was aware of the attendant risks that trading creates. He furthermore understood in writing that such trading can and does lead to higher than ordinary commission generation and he was comfortable with it as well as knew the total associated costs that accompanies a trading account. [REDACTED] had maintained many such accounts in the past with other firms similar in nature and had even sued brokers in the past for the same thing he is alleging now. This leads us to believe that he is simply a man who if he wins takes his chips and runs. If he loses, he uses the arbitration process as an effort to get his money back. I will vigorously defend myself against these allegations.
When your financial advisor is providing advice they must adhere to the SEC’s Regulation Best Interest (Reg BI) rule and standard of care. Reg BI replaced the former “suitability” rule and created a ‘best interest’ standard for brokerage firms and registered representatives. Reg BI applies when brokers recommend a retail investor engage in securities transaction or an investment strategy involving one or more securities. Reg BI also applies to financial advice concerning the transfer of funds and opening of accounts. 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.
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. 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. Reg BI comes with different core obligations that brokers must comply with. There is the duty of care obligation requiring financial advisors to form a reasonable belief that their investment advice and recommendations are in the retail investor’s best interest among other duties. In order to do that the broker must evaluate the potential risks, rewards, and costs associated with a product, account type, or series of transactions being recommended.
The care obligation also requires the broker to address the client’s specific needs through obtaining specific investment profile information on the client. The associated person typically will ask the customer for information such as the investor’s risk tolerance or ability to withstand account value declines or increases; experience with investments available; investment objectives and goals; investment time horizon; liquidity needs; assets such as investment accounts held at other financial institutions; tax information; their age and retirement plans; and other information that a customer may want to provide to the advisor to help them to properly address the services needed. 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. An advisor must understand the type of account, securities, and their client in order to meet their care obligations. The type of securities account has the potential to greatly affect retail customers’ costs and investment returns. Different types of securities accounts can offer different features, products, or services, and not all types of accounts or services would be in every investor’s best interest.
Labarbera has been in the securities industry for more than 27 years. Labarbera has been registered as a Broker with Titus Rockefeller, LLC since 2013.
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.