Securities Lawyers Blog
According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker Robert Lapetina (Lapetina), currently associated with Nationwide Planning Associates INC., has at least 2 disclosable events. These events include 2 customer complaints, alleging that Lapetina 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 $40,000.00 on May 21, 2020.
Time Frame: January 2, 2001 to December 28, 2012 What were the allegations against the individual? The client’s\<char_lb_r>\, attorney alleges the investments were unsuitable as they were illiquid and highly leveraged funds. The client’s attorney\<char_lb_r>\, further alleges the strategy was inappropriate and highly concentrated. The client’s attorney further alleges the client was misled to safety of the recommended investment. The attorney finally alleges adding further risk the firm provided a margin loan secured by the volatile fund assets in a brokerage account.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $40,000.00 on May 21, 2020.
Time Frame: January 2, 2001 to December 28, 2012 What were the allegations against the individual? The client’s\<char_lb_r>\, attorney alleges the investments were unsuitable as they were illiquid and highly leveraged funds. The client’s attorney\<char_lb_r>\, further alleges the strategy was inappropriate and highly concentrated. The client’s attorney further alleges the client was misled to safety of the recommended investment. The attorney finally alleges adding further risk the firm provided a margin loan secured by the volatile fund assets in a brokerage account.
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 Reg BI standard of care applies to registered representatives making recommendations to customers in the purchase, sale, or exchange of securities or the implementation of investment strategies involving securities and non-securities. The rule also applies to the handling of opening accounts such as account transfers and types of accounts being recommended to be opened. 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.
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 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. Reg BI comes with different key obligations that associated persons must meet in dispensing advice. The care obligation requires registered representatives to carefully evaluate investment options, review the risks and rewards of the investment or service, compare similar products, and ensure that the recommended investment is appropriate for the customer and in the retail investor’s best interest.
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. Finally, the advisor must use their knowledge of the first two elements to consider reasonably available investment option alternatives and come to the conclusion that there is a reasonable basis to believe that the recommendation or advice being provided 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.
Lapetina entered the securities industry in 1994. Lapetina has been registered as a Broker with Nationwide Planning Associates INC. since 2016.
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.