Steven Crawford Subject to Multiple Complaints Alleging Unsuitable Alternative Investments

shutterstock_73854277-300x200The securities attorneys at Gana Weinstein LLP are currently investigating Kestra Investment Services, LLC (Kestra Investment) broker Steven Crawford (Crawford). According to BrokerCheck, Crawford has been subject to four customer disputes, one of which is still pending. The majority of these disputes concern the unsuitable recommendation of alternative investments, including Variable Universal Life polices (VULs), variable annuities, and Real Estate Investment Trusts (REITs).

Most recently, in April 2018, Crawford was subject to a customer complaint in which a customer alleged that in 2001, Crawford misrepresented a VUL contract by failing to disclose the fact that the premium payment was not fixed – and could substantially or materially change over time. In 2016, the premium rose and policy lapsed – resulting in customer losses. The customer has requested $622,903.05 in damages. This dispute is currently still pending,

In August 2017, a customer alleged that from June 2016 to August 2017, Crawford recommended the Allianz Index Advantage Variable Annuity to the customer which was unsuitable to the customer’s investment objectives.

In June 2011, a customer alleged that from August 2007 to March 2008, Crawford recommended an REIT investment that was an unsuitable investment to the customer. The customer had requested $9,500 in damages.

In addition, Crawford has been subject to bankruptcy. Bankruptcy is a potential sign that financial advisors are struggling with their finances. The Financial Industry Regulative Authority (FINRA) makes this information public so that investors can have a better sense of their brokers.

VUL are complex insurance and investment products that investors must fully understand the risks and benefits of prior to investing. One feature of a VUL policy is that the owner can allocate a portion of his premium payments to a separate sub-account that can be used to grow in value through investments. Monthly charges for the life insurance policy such as an insurance charge and administrative fees are deducted from the policy’s cash value. The cash value of the policy may increase or decrease based on the performance of the sub-account investments. In addition, the VUL policy terminates, or lapses, if at any time the net cash surrender value is insufficient to pay the monthly cost deductions. Upon termination of the policy, the remaining cash value becomes worthless.

Brokers must be careful to ensure that the recommendation to invest in VULs is suitable for the client. For example, if a policy is too expensive for the client to continue to make premium contributions over time, then the policy could lapse and cause serious losses to the client. This is precisely what a customer alleged that Crawford failed to consider in some recommendations to his clients.

Crawford entered the securities industry in 1986 and has been registered with Kestra Investment since November 2017. From January 2006 to December 2017, Crawford was registered with LPL Financial, LLC. From December 1995 to January 2006, Crawford was registered with Jefferson Pilot Securities Corporation. From March 1993 to November 1997, Crawford was registered with Ascend Financial Services, Inc.

Investors who have suffered losses may be able recover their losses through securities arbitration. The attorneys at Gana Weinstein LLP are experienced in representing investors in unsuitable and misrepresented alternative investment recommendations and variable annuities. Our consultations are free of charge and the firm is only compensated if you recover