As a financial analyst and legal expert with over a decade of experience, I’ve seen firsthand how unsuitable investment recommendations can devastate investors’ portfolios and financial well-being. Mario Payne, a former broker with Raymond James who now works at TOAMS Financial in Jacksonville, Florida, is currently facing multiple disputes that allege he engaged in this exact misconduct.
According to Payne’s FINRA BrokerCheck profile, four parties of investors filed claims against him in 2024 alleging that he “improperly engaged in a high-risk, illiquid, complex, and unsuitable investment strategy” that concentrated their accounts in structured products like structured notes. The claims also allege Payne misrepresented these investments “as safe, guaranteed, and insured.” In total, the pending disputes seek $8.6 million in damages. The seriousness of these allegations and the high dollar amount at stake should concern any investor who has worked with Payne.
Shockingly, a study by the Securities Litigation and Consulting Group found that one in thirteen financial advisors have a record of misconduct, highlighting the importance of thoroughly vetting your advisor and staying vigilant for red flags.
What is concentration and why is it risky?
FINRA explains that concentration, also known as failure to diversify, occurs when a broker allocates a significant portion of an investor’s portfolio to a single security or asset class. This exposes the investor to substantial risk of loss if that security or asset declines in value, similar to the old adage of “putting too many eggs in one basket.” Complex investments can make it difficult for everyday investors to recognize when their portfolio has become overconcentrated.
To help mitigate concentration risk, FINRA recommends diversifying holdings across asset classes, regularly rebalancing, and ensuring any mutual funds or ETFs in the portfolio are not overly concentrated themselves. Unfortunately, the pending disputes claim Payne did the opposite by concentrating his clients in complex structured products. As an expert who has seen this story unfold time and again, I find the allegations very troubling if true.
Payne’s background and firm’s stated philosophy
Payne entered the industry in 2007 with Edward Jones before moving to Raymond James in 2013, where the alleged misconduct occurred. In 2019, he left to start his own investment advisory firm, TOAMS Financial, where he currently serves as owner and chief compliance officer. The firm’s website states its philosophy is to “generate lifelong wealth while making investing simple” and that it conducts “meticulous market research to ensure you are in good hands no matter what life throws your way.” The pending allegations against Payne starkly contradict this client-first ethos.
Warren Buffett famously said that “diversification is protection against ignorance. It makes little sense if you know what you are doing.” However, the reality is most individual investors are not experts and rely on their financial advisor to properly manage risk. Advisors who breach this trust by overconcentrating clients in unsuitable investments violate industry rules and may be held liable for losses.
What should investors do?
If you have worked with Mario Payne or TOAMS Financial and have concerns about your investments, I urge you to get a second opinion from an experienced securities attorney. You may be able to recover losses through FINRA arbitration if your account was overconcentrated in unsuitable investments. However, time is limited to file a claim so do not delay.
At MDF Law, we offer free consultations to investors across the nation. Our attorneys have recovered more than $100 million for victims of broker misconduct. While no advisor is immune from complaints, multiple pending disputes alleging the same type of misconduct is an obvious red flag that demands investigation in my professional opinion. Call us confidentially at 800-767-8040 if you believe you may have been the victim of unsuitable investment advice.
