Securities Lawyers Blog
According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker Dominick Greco (Greco), previously associated with LPL Financial LLC, has at least 4 disclosable events. These events include 4 customer complaints, alleging that Greco recommended unsuitable investments in different investment products including debt securities among other allegations and complaints.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $100,000.00 on July 22, 2020.
Claimant alleges that she desired to purchase safe investments, but instead was placed in Northstar Real Estate Investment II and FS Investment Corp. Claimant contends that those investments were unsuitable and that she suffered losses “approaching $100,000” because the value of the subject investments allegedly had declined. Activity period 1/2015 – 7/2020.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $1,776,167.00 on May 18, 2020.
The customers alleged unsuitable recommendations, breach of fiduciary duty, misrepresentation and negligence.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $100,000.00 on July 22, 2020.
Claimant alleges that she desired to purchase safe investments, but instead was placed in Northstar Real Estate Investment II and FS Investment Corp. Claimant contends that those investments were unsuitable and that she suffered losses “approaching $100,000” because the value of the subject investments allegedly had declined. Activity period 1/2015 – 7/2020.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $1,776,167.00 on May 18, 2020.
The customers alleged unsuitable recommendations, breach of fiduciary duty, misrepresentation and negligence.
Brokers are required to adhere to the SEC’s Regulation Best Interest (Reg BI) standard of care under the Securities Exchange Act of 1934 which establishes a ‘best interest’ standard for broker-dealers and associated persons. 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. Reg BI applies when brokers recommend a retail investor engage in securities transaction or an investment strategy involving one or more securities. Reg BI also applies to financial advice concerning the transfer of funds and opening of accounts.
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. Reg BI was meant to enhance the duties that registered representatives have to their clients by applying fiduciary principles to transactions and investment strategies by prohibiting brokers from placing their own financial interests ahead of the best interests of their client – the investor. Reg BI comes with different core obligations that brokers must comply with. There is the duty of care obligation requiring financial advisors to form a reasonable belief that their investment advice and recommendations are in the retail investor’s best interest among other duties. In order to do that the broker must evaluate the potential risks, rewards, and costs associated with a product, account type, or series of transactions being recommended.
The care obligation also requires the broker to address the client’s specific needs through obtaining specific investment profile information on the client. The associated person typically will ask the customer for information such as the investor’s risk tolerance or ability to withstand account value declines or increases; experience with investments available; investment objectives and goals; investment time horizon; liquidity needs; assets such as investment accounts held at other financial institutions; tax information; their age and retirement plans; and other information that a customer may want to provide to the advisor to help them to properly address the services needed. Finally, the financial advisor must use their knowledge of both their reasonable diligence into investment options as well as their knowledge of the investor’s client specific needs to consider reasonably available investment options. Those investment options must allow the broker to determine that there is a reasonable basis that the recommendation is in the retail investor’s best interest. Finally, an advisor must also analyze the specific account features offered and determine whether their client can benefit from them in order to meet their care obligations. While securities and investments come with costs that must be considered, the type of securities account also has changes the cost equation for the investor and can change the retail customers’ future investment returns. The associated person must consider the different types of securities accounts for their client and determine whether or not the cost or features are reasonably needed for the client or if the customer’s current account costs and features are superior to solutions available to the advisor. In any event, the type of account and services recommended must be in the investor’s best interest.
Greco has been in the securities industry for more than 18 years. Greco has been registered as a Broker with LPL Financial LLC since 2009.
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.