Securities Lawyers Blog
According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker David Geake (Geake), previously associated with American Trust Investment Services, Inc., has at least 25 disclosable events. These events include 23 customer complaints, 2 tax liens, alleging that Geake 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 $200,000.00 on January 21, 2025.
Breach of Fiduciary Duty; Suitability; Misrepresentation; FINRA Rules 2010, IM-2310-2 & 2020; Failure to Supervise; Breach of Contract
FINRA BrokerCheck shows a pending customer complaint with a damage request of $75,000.00 on January 21, 2025.
Breach of Fiduciary Duty and Negligence, Investments not appropriate for client.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $167,797.00 on January 21, 2025.
Violation of IL Securities Act of 1953; Breach of Fiduciary Duty; Negligent Hiring and Retention; Violation of Reg BI; FINRA Rules 2010, 2120, 3110; Failure to Supervise; Breach of Contract
FINRA BrokerCheck shows a pending customer complaint with a damage request of $325,000.00 on July 08, 2024.
Breach of Fiduciary Duty, Failure to Supervise, Breach of Contract
FINRA BrokerCheck shows a pending customer complaint with a damage request of $100,000.00 on July 01, 2024.
Violations of Federal Securities Laws; Violation of IL Consumer Fraud and Deceptive Business Practices Act; Violation of IL Securities Law; Breach of Contract; Negligence and Gross Negligence.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $111,000.00 on April 15, 2024.
Negligence; Breach of Fiduciary Duty; Breach of Contract; Unjust Enrichment; Consumer Fraud, Violation of the IL Securities Law. Mulholland and Patterson purchased GWG L Bonds in 2017 and 2018 while David Geake was registered with Ausdal Financial Partners, Inc.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $35,000.00 on March 22, 2024.
Unsuitable recommendations of alternative investments
FINRA BrokerCheck shows a pending customer complaint on March 19, 2024.
While registered as an investment advisor in the state of Illinois, David Richard Geake entered into a Letter of Acceptance, Waiver and Consent (\\u201cAWC\\u201d) with FINRA a self-regulatory organization registered under Federal Act. Pursuant to AWC No. 2021072679901, on July 23, 2023, Geake violated Rules 3280 and Rule 2010, based upon the following facts. Prior to association with Ausdal Partners Geake raised funds through sale of common stock, invested $10,000 in and was on the Board of Directors of a startup comp
FINRA BrokerCheck shows a pending customer complaint with a damage request of $32,000.00 on March 18, 2024.
Violations of Federal Securities Laws, Violation of IL Consumer Fraud and Deceptive Business Practices Act, Violation of IL Securities Law, Breach of Contract, Common Law Fraud, Breach of Fiduciary Duty, Negligence and Gross Negligence, related to the purchase of a GWG L bond in June 2018.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $410,000.00 on January 29, 2024.
Negligence; Misrepresentation and Omissions of Material Facts; Breach of Fiduciary Duty; Failure to Supervise.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $100,000.00 on January 05, 2024.
Negligence; Breach of fiduciary duty; Negligent Supervision
FINRA BrokerCheck shows a settled customer complaint on November 29, 2023.
Claimants allege unsuitable recommendations of alternative investments, primarily in NorthStar Healthcare REIT. The dates vary for the numerous claimants listed.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $1,500,000.00 on October 23, 2023.
Unsuitable investments, due diligence, failure to supervise
FINRA BrokerCheck shows a settled customer complaint with a damage request of $1,000,000.00 on October 17, 2023.
Unsuitable recommendations of alternative investments.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $90,000.00 on October 11, 2023.
Unsuitable investments, failure to supervise, Due diligence
FINRA BrokerCheck shows a settled customer complaint with a damage request of $80,000.00 on September 27, 2023.
Violation of federal and state securities laws, breach of fiduciary duty, suitability, failure to supervise
FINRA BrokerCheck shows a pending customer complaint with a damage request of $500,000.00 on September 26, 2023.
Unsuitable recommendations of alternative investments and Market Serv
FINRA BrokerCheck shows a pending customer complaint with a damage request of $500,000.00 on September 25, 2023.
Selling away, Over concentration in alternative investments, failure to act in the ‘best interest’ of the claimant, breach of fiduciary duty, breach of contract, failure to supervise, negligence, violation of the federal securities laws.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $50,001.00 on September 15, 2023.
Unauthorized trading, unsuitable investments
FINRA BrokerCheck shows a pending customer complaint with a damage request of $165,000.00 on August 28, 2023.
Unsuitable investments, failure to act in the ‘best interest’ of claimants, misrepresentation and omission, breach of fiduciary duty, breach of contract, failure to supervise, violation of the federal securities laws
FINRA BrokerCheck shows a pending customer complaint with a damage request of $100,000.00 on August 09, 2023.
Suitability, Failure to supervise, negligence, breach of contract, breach of fiduciary duty, misrepresentation, violation of Regulation Best Interest
FINRA BrokerCheck shows a settled customer complaint with a damage request of $50,000.00 on August 08, 2023.
Demand for settlement, related to purchase of GWG L Bond in January 2017, alleging unsuitable investment, lack of due diligence and failure to supervise.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $50,000.00 on July 28, 2023.
Unsuitable investments, Failure to act in the ‘best interest’ of claimants, Breach of fiduciary duty, Breach of contract, Failure to supervise, Violation of federal securities law.
FINRA BrokerCheck shows a final customer complaint on July 10, 2023.
Without admitting or denying the findings, Geake consented to the sanction and to the entry of findings that he participated in a private securities transaction by soliciting elderly investors, a husband and wife, to pledge approximately $15 million of securities as collateral to guarantee a $2.5 million loan from a bank on behalf of a startup company without providing written notice to his member firm. The findings stated that Geake personally invested $100,000 in the company and was also a member of its Board of Directors. Geake assured the couple that their risk of investment loss was minimal. Geake structured the transaction and facilitated the paperwork on behalf of the couple. The pledge of securities as collateral for the loan was an offer of a security and the couple received shares of the company’s common stock in exchange for their guarantee of the loan. By soliciting this pledge of securities and facilitating the transaction, Geake participated in a private securities transaction. Subsequently, the company fully defaulted on the bank loan and closed its business and the bank called for the loan to be paid in full. As a result, the couple were required to repay the entire $2.5 million bank loan with interest. Although neither of the investors were firm customers, the firm’s policies prohibited its registered representatives, including Geake, from engaging in any private securities transaction without prior express written permission. The findings also stated that Geake incorrectly attested to the firm on multiple annual compliance questionnaires that he had not participated in any private securities transactions.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $25,000.00 on April 18, 2023.
Failure to Supervise, Breach of Fiduciary Duty, Breach of Contract, Violation of Securities Law
Under the securities laws brokers are obligated to act in their clients’ best interests and provide only suitable recommendations for investments to the client. In addition, the SEC has promulgated ‘Regulation Best Interest (Reg BI)‘ which according to the SEC enhanced the broker-dealer standard of conduct beyond existing suitability obligations and requires broker-dealers to act in the best interest of a retail customer when making a recommendation of any securities transaction or investment strategy involving securities. Regulation Best Interest and the fiduciary standard for investment advisers are drawn from key fiduciary principles that include an obligation to act in the retail investor’s best interest and not to place their own interests ahead of the investor’s interest.
Brokers have an obligation to first obtain and evaluate sufficient information about a retail investor to form a reasonable basis to believe the account recommendations are in the retail investor’s best interest. Recommendations cannot be based on materially inaccurate or incomplete information. Every recommendation’s cost and investor details are always part of material information. Types of costs that must be considered including account fees, commissions and transaction costs, tax considerations, as well as indirect costs.
In addition to obligation to understand the customer the broker must also investigate the product being sold. FINRA firms have an obligation to conduct a reasonable investigation of the issuer and the securities they recommend in offerings. A brokerage firm has a special relationship with a customer from the fact that in recommending the security, the broker represents to the customer that a reasonable investigation has been made. So, a brokerage firm should not depend solely on information from the issuer regarding a company, but must perform its own thorough investigation.
Additional, it should be required to mandate broker disclosures for investor’s protection. FINRA requires the broker to disclosure events such as customer complaints, IRS tax liens, judgments, investigations, terminations, and even criminal matters on their public BrokerCheck reports. FINRA has recognized that recent studies offer evidence showing that brokers with a past history of regulatory and customer complaint issues are more likely to have such issues in the future. FINRA’s Office of the Chief Economist (OCE) published a study showing the predictability of disciplinary and disclosure events based on past similar events. The OCE study showed that past disclosure events, including regulatory actions, customer arbitrations and litigations of brokers, have significant power to predict future investor harm. The data shows that where a member firm on-boards brokers with a significant history of misconduct there is a high likelihood that the broker will continue to engage in similar behavior.
Geake has been in the securities industry for more than 24 years. Geake has been registered as a Broker with American Trust Investment Services, Inc. since 2018.
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.