As a former financial advisor and legal expert with over a decade of experience, I’ve seen my fair share of cases involving alleged misconduct by financial professionals. The recent complaint against Greg Ritter, a Delaware, Ohio-based financial advisor with Emerson Equity, doing business as Family Financial of Central Ohio, is a serious matter that deserves attention.
According to the complaint filed in September 2024, Mr. Ritter allegedly:
- Breached his fiduciary duty
- Acted negligently
- Violated Regulation Best Interest
- Violated securities industry rules and regulations
These allegations are related to investments in corporate bonds, with the pending complaint alleging damages of $135,000. As a financial advisor, Mr. Ritter had a responsibility to act in the best interests of his clients and adhere to industry regulations. If the allegations are proven true, it could have significant consequences for both Mr. Ritter and his clients.
The Financial Advisor’s Background
Greg Ritter has been in the securities industry for 23 years and has been registered as a broker and investment advisor with Emerson Equity since 2010. He has passed five securities industry qualifying exams and is licensed in multiple states. Prior to his current position, Mr. Ritter was registered with several other firms, including Chase Investment Services, New England Securities, and Morgan Stanley DW.
It’s worth noting that Mr. Ritter’s BrokerCheck report, available through FINRA’s website (CRD# 3087358), discloses one investor complaint. While every advisor’s record is different, it’s essential for investors to research their financial advisor’s background thoroughly before investing.
Understanding FINRA Rules and Regulations
The Financial Industry Regulatory Authority (FINRA) is a self-regulatory organization that oversees the conduct of financial advisors and brokerage firms. One of the key rules mentioned in the complaint against Mr. Ritter is Regulation Best Interest, which requires brokers to act in the best interest of their clients when making investment recommendations.
In simple terms, this means that advisors must put their clients’ interests ahead of their own and provide recommendations that are suitable based on the client’s financial situation, risk tolerance, and investment objectives. Violating this rule can lead to disciplinary action by FINRA and potential legal consequences.
Consequences and Lessons Learned
The outcome of the complaint against Greg Ritter remains to be seen, but it serves as a reminder of the importance of working with a trustworthy and ethical financial advisor. As the famous investor Warren Buffett once said, “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.”
One sobering statistic to keep in mind: according to a study by the University of Chicago, approximately 7% of financial advisors have a history of misconduct. While this may seem like a small percentage, it translates to nearly 100,000 advisors nationwide.
As an investor, it’s crucial to do your due diligence when selecting a financial advisor. This includes researching their background, understanding their investment philosophy, and ensuring they are properly licensed and registered. By taking these steps, you can help protect yourself and your investments from potential misconduct.
