Securities Lawyers Blog
According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker Michael Ning (Ning), previously associated with Arque Capital, Ltd., has at least one disclosable event. These events include one regulatory event, alleging that Ning recommended unsuitable investments in different investment products including debt securities among other allegations and complaints.
FINRA BrokerCheck shows a pending customer complaint on June 04, 2025.
Ning was named a respondent in a FINRA complaint alleging that it failed to provide documents and information requested by FINRA in connection with its investigation into whether certain securities recommendations by his member firm’s registered representatives to customers were in the best interests of the customers. The complaint alleges that Ning was President, CEO, and custodian of records for the firm. FINRA sought documents regarding certain identified securities, and the firm’s recommendations of, and communications regarding, those securities to specified customers of two former firm representatives, among other things. The documents and information FINRA requested were material to its investigation because they directly related to recommendations of certain identified securities by the firm’s representatives to specified customers of the two former firm representatives, whether those securities were in the customers’ best interest, and whether those individuals and/or the firm violated any securities laws, regulations, or FINRA rules. The complaint also alleges that Ning failed to provide the requested records in his role as the firm’s custodian. On March 29, 2024, Ning, on behalf of the firm, filed an amended Form BDW with FINRA naming himself as the designated custodian of records. In this role, Ning was required to make the requested records available to FINRA upon request yet failed to do so.
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 is drawn from fiduciary principles that include an obligation to act in the retail investor’s best interest and the broker is prohibited from placing their own interests ahead of the investor’s interest.
There are several different aspects of the rule that brokers must comply with. One of which is the care obligations which requires brokers to form a reasonable belief that their investment advice and recommendations are in the retail investor’s best interest. The care obligations includes 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. 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. 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.
Ning has been in the securities industry for more than 33 years. Ning has been registered as a Broker with Arque Capital, Ltd. since 2005.
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.