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Broker Sam Schoner Faces Multi-Million Dollar Claims at J.P. Morgan

As a seasoned financial analyst and legal expert with over a decade of experience, I have seen my fair share of customer disputes involving financial advisors. The case of Sam C. Schoner (CRD#: 1928356), a registered broker and investment advisor with J.P Morgan Securities LLC in San Francisco, CA, is one that certainly raises concerns for investors.

The Seriousness of the Allegations

According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), Sam Schoner is currently the subject of two pending customer disputes:

  • In December 2023, a customer alleged “unsuitable investment advice” spanning from January 2012 to September 2023, with a damage amount of $2,500,000.
  • In September 2023, customers alleged “unsuitable investment recommendation” from 2017 to 2023, with a staggering damage amount of $7,498,468.

These allegations are serious and could potentially lead to significant losses for the affected investors. As a financial advisor, it is crucial to always prioritize the best interests of your clients and provide suitable investment recommendations based on their individual needs, goals, and risk tolerance.

The Financial Advisor’s Background and Past Complaints

Sam Schoner entered the securities industry in 1989 and has worked with several well-known firms, including Wells Fargo Securities, Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, and First Republic Wealth Advisors, LLC.

However, this is not the first time Schoner has faced a customer dispute. In August 2010, a customer alleged “breach of fiduciary duty, professional negligence, negligent misrepresentation, breach of contract, fraud and deceit, elder abuse, unsuitable recommendations, misstatement and omissions of material facts, and use of fraudulent devices” related to the sale of the TW Tax Advantaged Fund, L.P. in August 2007. The damage amount requested was $351,135.62, and the dispute settled for $180,000.

As the famous investor Warren Buffett once said, “Risk comes from not knowing what you’re doing.” It is essential for financial advisors to thoroughly understand the products they recommend and ensure they align with their clients’ risk profiles.

Understanding FINRA Rules and Suitability

FINRA has established clear rules regarding the suitability of investment recommendations. Financial advisors must have a reasonable basis to believe that a recommendation is suitable for a particular customer based on that customer’s investment profile, which includes factors such as age, tax status, time horizon, liquidity needs, risk tolerance, and financial situation.

Moreover, even if individual investments are suitable when viewed in isolation, advisors must ensure that the overall investment strategy is not excessive or unsuitable for the customer. This is known as quantitative suitability.

Did you know that according to a study by the University of Chicago, approximately 7% of financial advisors have a history of misconduct? This highlights the importance of thoroughly researching your financial advisor and staying informed about their background and any potential red flags.

The Consequences and Lessons Learned

The consequences of unsuitable investment advice can be devastating for investors, leading to significant financial losses and emotional distress. It is crucial for investors to be proactive in monitoring their investments and questioning any recommendations that seem questionable or misaligned with their goals.

If you believe you have been the victim of unsuitable investment advice, it is essential to consult with a qualified securities attorney who can help you understand your rights and potential avenues for recovery.

As for financial advisors, the case of Sam Schoner serves as a stark reminder of the importance of always putting clients’ interests first, conducting thorough due diligence, and ensuring that investment recommendations are suitable based on each client’s unique circumstances. By adhering to these principles, advisors can build long-lasting, trusting relationships with their clients and avoid the damaging consequences of customer disputes.

For more information on Sam Schoner’s background and disclosure history, you can access his FINRA BrokerCheck report.

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