Securities Lawyers Blog
According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker William Humbarger (Humbarger), previously associated with Nylife Securities LLC, has at least 7 disclosable events. These events include 7 customer complaints, alleging that Humbarger recommended unsuitable investments in different investment products including debt securities among other allegations and complaints.
FINRA BrokerCheck shows a settled customer complaint on August 13, 2020.
Plaintiffs allege that in or around February 1999 and March 1999 they were misled into exchanging life insurance policies into Variable Universal Life policies which carried significant surrender charges and were not suitable. Plaintiffs seek compensatory and punitive damages as well as costs and fees.
FINRA BrokerCheck shows a settled customer complaint on June 23, 2020.
Plaintiffs allege that in January 1998, they were misled into borrowing the cash value of independently owned life insurance policies to pay the initial\<char_lb_r>\, premium of a variable universal policy and exchanging a fixed life insurance policy for that variable universal life policy. Plaintiffs are seeking unspecified\<char_lb_r>\, damages, costs and attorney’s fees.
FINRA BrokerCheck shows a settled customer complaint on June 23, 2020.
Plaintiff alleges that in February 2011, the deceased was misled into exchanging 3 life insurance policies into a variable universal policy. Plaintiff is seeking\<char_lb_r>\, unspecified damages, costs and attorney’s fees.
FINRA BrokerCheck shows a settled customer complaint on August 13, 2020.
Plaintiffs allege that in or around February 1999 and March 1999 they were misled into exchanging life insurance policies into Variable Universal Life policies which carried significant surrender charges and were not suitable. Plaintiffs seek compensatory and punitive damages as well as costs and fees.
FINRA BrokerCheck shows a settled customer complaint on June 23, 2020.
Plaintiffs allege that in January 1998, they were misled into borrowing the cash value of independently owned life insurance policies to pay the initial\<char_lb_r>\, premium of a variable universal policy and exchanging a fixed life insurance policy for that variable universal life policy. Plaintiffs are seeking unspecified\<char_lb_r>\, damages, costs and attorney’s fees.
FINRA BrokerCheck shows a settled customer complaint on June 23, 2020.
Plaintiff alleges that in February 2011, the deceased was misled into exchanging 3 life insurance policies into a variable universal policy. Plaintiff is seeking\<char_lb_r>\, unspecified damages, costs and attorney’s fees.
FINRA BrokerCheck shows a settled customer complaint on March 05, 2020.
Customers allege that in March 2002 they were misled when they exchanged their Whole Life Policy for a Variable Universal Life policy that was not suitable and they did not understand.
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 a registered representative is providing investment advice through making recommendations customers and covers securities transaction, investment strategies, and recommendations concerning advice on opening of an account or 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. The Reg BI rule applies a fiduciary principles and requires an associated person to act in the retail investor’s “best interests” while barring the broker from placing their own financial interests and compensation incentives ahead of the investor’s best interest. There are several different aspects of the rule that brokers must comply with. One of which is the care obligations which require brokers to form a reasonable belief that their investment advice and recommendations are in the retail investor’s best interest. The care obligations include 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.
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 associated person must then apply both their reasonable diligence into various investment options as well as the information gathered as to the investor’s specific needs when considering the investment recommendation. The broker must explore various alternative investment options available to address these needs and determine that there is a reasonable basis to believe that the recommendation or service being recommended is in the retail investor’s best interest. In addition to specific investments being recommended, under Reg BI, a broker must also understand the type of account that their client would need in order to meet their care obligations. The SEC has stated that the type of securities account an investor has can greatly affect a customers’ costs and overall investment returns. Further, different account types can offer and support different features, products, securities, or services, and account type would not be appropriately applied in a one size fits all manner.
Humbarger has been in the securities industry for more than 34 years. Humbarger has been registered as a Broker with Nylife Securities LLC since 1983.
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.