Securities Lawyers Blog
The securities attorneys at Gana Weinstein LLP represent investors in their disputes with brokerage firms, such as Osaic Services, Inc.. Our firm can analyze your accounts and investments in order to determine if there was any broker misconduct in the handling of your accounts. Our analysis can reveal whether an investor has been a victim of misconduct such as unsuitable investments, unauthorized trading, excessive trading, or investment fraud.
Osaic Services is a broker-dealer within the Osaic wealth management network that provides securities distribution for the Osaic platform. Formed in Delaware in 2004, the firm is part of Osaic, which consolidated eight legacy broker-dealer brands including FSC Securities, Royal Alliance Associates, SagePoint Financial, Securities America, Triad Advisors, Woodbury Financial Services, American Portfolios, and Infinex Investments into a single platform.
Osaic Services, Inc. – By the Numbers:
- CRD #: 133763
- Regulatory Events: 26
- Arbitration Events: 11
- Broker Employees: 20
Osaic Services, Inc. – In the News:
FINRA v. Osaic Services, Inc. (Case #2021070904301) – From at least June 2018 to at least August 2019, Osaic Services failed to establish and maintain a supervisory system, including written supervisory procedures, reasonably designed to achieve compliance with the suitability requirements of FINRA Rules 2111 and 2360(b)(19) as they pertain to excessive and unsuitable trading and options trading. Osaic Services permitted registered representatives who lacked sufficient knowledge, training, and experience with respect to options trading to override automated supervisory alerts and trading restrictions. Moreover, the firm permitted one of its registered representatives (Broker A) to open in the account of one customer (Customer 1) options positions that required the use of margin, even though the customer did not have a margin account. Some of those options transactions exposed Customer 1 to a risk of loss exceeding $4.5 million—over 22 times her liquid net worth of $200,000. Finally, Osaic Services failed to respond reasonably to indications that Broker A was excessively or unsuitably trading customer accounts, including those of Customers 1 and 2 (Customer 1’s mother). As a result, the two customers paid over $60,000 in commissions and costs, and incurred over $1.2 million in losses. Osaic Services therefore violated FINRA Rules 3110, 2360(b)(20), and 2010. Additionally, from at least February to June 2019, Osaic Services failed to reasonably supervise for unauthorized trading in the account of Customer 2 after she died. As a result, the firm violated FINRA Rules 3110 and 2010.
FINRA v. Osaic Services, Inc. (Case #2021069460901) – From September 2015 to September 2020, Securities America, Royal Alliance, and SagePoint failed to establish and maintain a supervisory system reasonably designed to ensure that all eligible customers received applicable sales charge waivers or special share classes in connection with rolling over 529 plans from one state plan to another. Some customers who were eligible for these waivers or special share classes did not receive them. Therefore, Respondents violated MSRB Rule G-27. As more fully described below, FINRA credits Respondents for their extraordinary cooperation. Accordingly, this AWC includes an undertaking to pay restitution totaling approximately $515,000 plus interest, and censures, but no fines.
FINRA v. Osaic Services, Inc. (Case #2018060895801) – Between May 4, 2018, and June 29, 2018, FSC Securities, Royal Alliance, SagePoint Financial and Woodbury Financial negligently failed to tell investors in an offering related to GPB Capital Holdings, LLC (GPB Capital) that the issuer failed to timely make required filings with the Securities and Exchange Commission, including filing audited financial statements. By virtue of the foregoing, each firm violated FINRA Rule 2010.
FINRA v. Osaic Services, Inc. (Case #2019061612601) – During the period April 2014 through July 2017, SagePoint failed to establish, maintain, and enforce a supervisory system, including WSPs, reasonably designed to achieve compliance with the suitability requirements of FINRA Rule 2111 as they pertain to margin use. As a result, SagePoint failed to identify or reasonably respond to red flags of unsuitable use of margin in two customer accounts that caused the customers to pay more than $51,800 in commissions, fees, and margin interest. By this conduct, SagePoint violated NASD Rule 3010, FINRA Rules 3110 and 2010.
FINRA v. Osaic Services, Inc. (Case #2019062531501) – From January 1, 2013 through June 30, 2018, Royal Alliance, Sagepoint, and FSC failed to establish and maintain a supervisory system reasonably designed to supervise 529 plan share-class recommendations in violation of MSRB Rule G-27. These three Advisor Group firms shared written supervisory procedures that did not reasonably address the share-class suitability factors specific to 529 plan investments. In addition, the firms’ transaction review system was not reasonably designed to identify 529 plan share-class recommendations that were inconsistent with the investment time horizon suggested by the age of the account beneficiary. The firms voluntarily self-reported potential issues with their supervisory system to FINRA as part of the 529 Plan Share Class Initiative announced in Regulatory Notice 19-04 and proposed a plan to remediate affected customers. Accordingly, the AWC includes a censure for each firm and orders of restitution and estimated interest totaling $485,441 but no fines.
Gana Weinstein LLP has successfully litigated broker disputes through verdict or settlement. We represent both individuals and institutions throughout the country in FINRA arbitration, as well as commercial litigation in state and federal courts. Our consultations are both free and thorough and our securities litigation attorneys can help you uncover wrongful activity in your account.