Securities Lawyers Blog
Alternative investment losses, REIT investment losses, DST investment losses, leveraged ETF losses, and other retirement investment losses are frequently traced to recommendations that were unsuitable for the investor. The investment loss lawyers at Gana Weinstein LLP represent customers of brokerage firms such as WestPark Capital, Inc. in FINRA arbitration claims to recover losses in these products. If you are wondering whether you can sue for investment losses or recover losses from a financial advisor, our attorneys can review your accounts and give you a clear answer.
WestPark Capital is a full service investment banking and securities brokerage firm offering initial public offerings, follow-on offerings, private placements, mergers and acquisitions advisory and restructuring services alongside brokerage for individual and institutional investors. Headquartered in Los Angeles with offices including Irvine and New York, the firm focuses on emerging growth companies in sectors such as healthcare, technology, biotechnology, consumer products and media, and has led numerous small-cap Nasdaq IPOs.
WestPark Capital, Inc. – By the Numbers:
- CRD #: 39914
- Regulatory Events: 15
- Arbitration Events: 2
- Broker Employees: 51
WestPark Capital, Inc. – Investment Advisors:
- SEC #: 108275
- Assets Under Management: $53,077,941
- ADV Form Employee: 11
WestPark Capital, Inc. – In the News:
FINRA v. WestPark Capital, Inc. (Case #2021070498107) – Between at least March 2019 and the present, WestPark violated FINRA Rules 3110 and 2010, and, between June 30, 2020, and the present, willfully violated Regulation Best Interest (Reg BI), by failing to establish, maintain, and enforce a supervisory system, including written procedures, reasonably designed to achieve compliance with Reg BI’s Care Obligation and FINRA Rule 2111. As a result, WestPark failed to reasonably supervise recommendations of GWG L Bonds to 10 retail customers that were not in the best interests of or suitable for the customers. In addition, between at least December 2018 and the present, WestPark violated FINRA Rules 3110 and 2010, and, between June 30, 2020, and the present, willfully violated Reg BI by failing to establish and maintain a reasonable supervisory system with respect to private placement due diligence. For these violations, WestPark is censured, fined $175,000, ordered to pay $345,073 in restitution plus interest, and agrees to certify that the firm has remediated the issues identified in this AWC.
FINRA v. WestPark Capital, Inc. (Case #2020067785302) – At various times over six years, between March 2016 and March 2022, WestPark Capital violated multiple rules and the federal securities laws. First, between November 2018 and March 2021, WestPark failed to develop and implement a reasonably designed anti-money laundering (AML) program despite opening new accounts and facilitating money movements and securities transactions for customers referred to the firm by three high-risk investment banking clients (Issuers A, B, and C). As a result of its deficient AML program, the firm repeatedly opened accounts for customers referred by these issuers in the face of red flags that indicated representatives of these issuers were controlling the activity in the customers’ accounts. The firm also failed to take reasonable steps to detect and investigate red flags of potentially suspicious trading in Issuer A. The firm compounded its AML failures by designating an inexperienced and unregistered analyst (Associated Person A) as its primary contact with Issuers A and B and the customers they referred. The firm also failed to supervise and retain communications between Associated Person A and the issuers, which occurred primarily in Mandarin on an unapproved messaging system. Further, despite Associated Person A’s lack of any AML experience, WestPark made him responsible for investigating and responding to AML inquiries from its clearing firm about the issuers and the referred customers, without taking reasonable steps to supervise him in that process. The firm therefore violated FINRA Rules 3310 and 2010. Second, WestPark’s November 2021 AWC required the firm, because of its negligent misrepresentations, to make offers of rescission to the holders of 19 promissory notes issued by WestPark’s parent company. Months before executing the AWC, however, the firm thwarted that rescission process without FINRA’s knowledge by inducing all but three of the noteholders to sign “irrevocable” agreements not to accept any offer of rescission that would be made pursuant to an AWC. Moreover, the firm later attempted to enforce the agreements not to accept rescission and falsely informed FINRA that no noteholders had requested rescission when one had explicitly done so. The firm then failed to pay that noteholder for over a year. The firm therefore violated FINRA Rule 2010. Finally, in violation of FINRA Rules 3110 and 2010, between March 2016 and December 2021, WestPark failed to establish, maintain, and enforce a supervisory system and written procedures reasonably designed to achieve compliance with Section 5 of the Securities Act of 1933 and FINRA rules regarding suitability, markups and markdowns, best execution, and self-supervision.
FINRA v. WestPark Capital, Inc. (Case #2017054381603) – Between January 2012 and January 2018, WestPark sold 33 promissory notes issued by WestPark’s parent company, WPCFS, to 21 customers, raising a total of $3.9 million (the “WPCFS Offerings”). WestPark made negligent misrepresentations and omissions of material facts to the customers in connection with the sale of the WPCFS Offerings. As a result, WestPark violated FINRA Rule 2010, both independently and by acting in contravention of Section 17(a)(2) and (3) of the Securities Act of 1933. Further, in connection with the sale of four of the WPCFS notes, Rappaport made negligent misrepresentations and omissions concerning the WPCFS Offerings. Thus, Rappaport violated FINRA Rule 2010. WestPark and Rappaport also failed to reasonably supervise the registered representatives soliciting investments in the WPCFS Offerings. Rappaport was responsible for the final approval of the offering documents and was the designated supervisor with respect to WestPark’s private placement business. As a result, Westpark and Rappaport violated NASD Rule 3010 and FINRA Rules 3110 and 2010. Further, in July 2019, WestPark became subject to the requirements of FINRA Rule 3170 (the “Taping Rule”), which requires firms, among other things, to establish, maintain, and enforce special written procedures to record “all telephone conversations between [its] registered persons and both existing and potential customers and [to review] the tape recordings to ensure compliance with applicable securities laws and regulations and applicable FINRA rules.” The firm’s special written procedures in effect from July 2019 were not reasonably designed to comply with the Taping Rule, and the firm failed to record all conversations as required under the Taping Rule. As a result, WestPark violated FINRA Rules 3170 and 2010.
FINRA v. WestPark Capital, Inc. (Case #2015047727501) – From July 1, 2015 through September 30, 2018 (the “review period”), the firm, based on a sample, submitted 130 inaccurate Reportable Order Events (“ROEs”) and over-reported 188 ROEs to the Order Audit Trail System (“OATS”) in violation of FINRA Rules 7450 and 2010. The firm also disclosed the incorrect capacity code on 871 customer confirmations in violation of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-10 thereunder (“SEC Rule 10b-10”) and FINRA Rule 2010. Further, the firm failed to establish a reasonable supervisory system, including written supervisory procedures, to achieve compliance with OATS and confirmation disclosure rules in violation of FINRA Rules 3110(a)-(b) and 2010.
FINRA v. WestPark Capital, Inc. (Case #2016051690101) – WestPark: (i) failed to establish and maintain a system of supervision reasonably designed to supervise its business in Collateralized Mortgage Obligations (“CMOs”) during the period January 2015 through October 2016, in violation of FINRA Rules 3110(a) and 2010; (ii) failed to adequately implement its written procedures during the same period in violation of FINRA Rules 3110(b) and 2010; and, (iii) failed to offer CMO educational materials to retail investors prior to their first CMO purchases made in April 2015 through August 2015, in violation of FINRA Rules 2216 and 2010.
Our attorneys have successfully represented hundreds of investors in investment disputes with their brokers and brokerage firms, including firms such as WestPark Capital, Inc. Our consultations are free and we welcome all inquiries.