Securities Lawyers Blog
According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker Melton Weaver (Weaver), previously associated with PFS Investments INC., has at least 2 disclosable events. These events include one customer complaint, one regulatory event, alleging that Weaver recommended unsuitable investments in different investment products including debt securities among other allegations and complaints.
FINRA BrokerCheck shows a pending customer complaint on October 16, 2025.
Plaintiffs allege they purchased e-commerce stores and digital real estate from champion e-com, which was operated by lan prukner, jake fruge, melton weaver and another individual. Plaintiffs allege, among other things, that the e-commerce stores and digital real estate were unregistered securities. Plaintiffs were not customers of pfs investments and the complaint indicates that they made their purchases after prukner, fruge and weaver were no longer associated with pfs investments.
FINRA BrokerCheck shows a final customer complaint on November 28, 2023.
Without admitting or denying the findings, Weaver consented to the sanctions and to the entry of findings that he engaged in an OBA as an owner and chief financial officer of a company that engaged in e-commerce and lead generation without providing prior written notice to his member firm. The findings stated that the OBA’s customers-including certain firm customers and registered representatives-each paid an up-front fee of at least $40,000 per e-commerce storefront and $4,000 per digital real estate website. The OBA’s customers then received a percentage of any income those storefronts and websites generated. Another owner associated with the firm orally disclosed the e-commerce storefront component of the OBA to the firm. At the same time, the other owner also informed the firm that Weaver was involved with the OBA. Even though Weaver never disclosed any component of his OBA to the firm, it approved the e-commerce storefront component of his OBA. By this time, more than 33 customers had already paid substantial fees to the OBA. Later, the digital real estate component of the OBA was reported to the firm. By this time, over 200 OBA customers had already purchased over 900 digital real estate websites, and Weaver had earned a significant amount from his involvement with the OBA. Following its approval of the e-commerce storefront component of Weaver’s OBA, the firm learned that the OBA had been marketed to other firm registered representatives, potentially creating a conflict of interest with Weaver’s firm business. The firm warned Weaver to stop allowing his OBA to market its products in this manner and requested further information about the company, including the names of any firm customers or registered representatives who had purchased e-commerce storefronts. Weaver did not provide the requested information. Weaver’s failure to provide complete and prior written OBA disclosures to the firm undermined its ability to ‘evaluate’ the OBA and determine whether to restrict or prohibit Weaver’s participation in it. The firm directed Weaver to stop allowing his OBA to market the e-commerce storefront component, which was the only component of the OBA that had been disclosed to the firm. Nonetheless, Weaver continued to allow his OBA to market products of the company. The firm instructed Weaver to choose between his OBA and working for the firm. Weaver continued with his OBA, but he did not voluntarily resign from the firm. As a result, the firm ultimately discharged Weaver.
In the financial industry advisors must meet the requirements of the SEC’s Regulation Best Interest (Reg BI) in providing investment advice and services. Reg BI established a ‘best interest’ standard for brokerage firms and registered representatives. 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. This Reg BI standard of care applies to registered representatives making recommendations to customers in the purchase, sale, or exchange of securities or the implementation of investment strategies involving securities and non-securities. The rule also applies to the handling of opening accounts such as account transfers and types of accounts being recommended to be opened.
Another aspect of the care obligation is focusing on the client’s specific needs which brokers must reasonably understand through obtaining information for the client’s investment profile. In completing a customer’s investment profile the advisor should include information such as the investor’s investment time horizon; liquidity needs; risk tolerance; experience with various investment vehicles; investment objectives and financial goals; assets and debts including outside investment accounts; marital status; tax information; age; and other relevant information that may be individual to the investor that the advisor would need to know to properly render advice or provide services. The SEC has stated that Reg BI is drawn from fiduciary principles that are common to both brokers and investment advisors including an obligation to act in the investor’s best interest and prohibiting an advisor from placing their own interests ahead of the investor’s. Reg BI comes with different key obligations that associated persons must meet in dispensing advice. The care obligation requires registered representatives to carefully evaluate investment options, review the risks and rewards of the investment or service, compare similar products, and ensure that the recommended investment is appropriate for the customer and in the retail investor’s best interest.
Next, the broker must understand the investor’s investment background and profile. A customer’s profile includes information that describes the investor’s financial situation and needs. Information here will include their outside securities accounts and investments; relevant assets and debts; tax bracket; age; liquidity needs; risk tolerance; investment time horizon; experience with investing; investment objectives; and any other relevant information that the investor may choose to disclose pertinent to their situation. Using the foregoing information, the associated person then must consider reasonably available investment option to accomplish the investor’s goals as well as alternative investment options that may be cheaper or other important qualities. Finally, the advisor must conclude that there is a reasonable basis to believe that the recommendation being provided is in the 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.
Weaver has been in the securities industry for more than 10 years. Weaver has been registered as a Broker with PFS Investments INC. 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.