Let’s talk about an issue that has rocked the investment community lately: the Financial Industry Regulatory Authority (FINRA) barring of John Engler Sr (FINRA CRD#: 835827) from affiliating with any of its members. Now, this isn’t a small matter. I’ve been in this industry long enough to know that such a decision indicates a severe breach of protocol or significant legal issues. Engler’s case is related to allegations of “unsuitable investments” and financial misappropriation.
It marks a disheartening violation of trust, which I find deeply concerning as a long-standing professional in this field. Investors place their hard-earned money in the hands of financial advisors, expecting responsible management and ethical conduct. Unfortunately, this ongoing case involving Engler highlights that these expectations are sometimes not met, underscoring the importance of a vigilant eye on advisors.
It brings to mind a famous quote often credited to Warren Buffet: “It takes 20 years to build a reputation and five minutes to ruin it.” This quote holds true not just for the investor’s relationship with their advisor but also shapes their trust in the investing industry.
Factually, according to Forbes magazine, in 2019, investment losses due to unscrupulous advisors were estimated at $10 billion.
John Engler Sr: Background, Broker Dealer, and Complaints Record
Now let’s delve a bit deeper into the details. John Engler Sr, who was registered with Ameriprise Financial Services, LLC (CRD No. 6363) from October 2014 to June 7, 2023, had his registration terminated following a customer lawsuit alleging he made unsuitable investments and misappropriated from her account. Ameriprise took note of the severity of the accusations and took firm action by terminating Engler’s registration.
Prior affiliations: 07/01/2003 – 10/27/2014 with Wells Fargo Advisors, LLC (CRD#:19616), Augusta, GA.
But this case isn’t a first-time setback for Engler. He has a record of customer disputes lodged against him. These complaints, a part of his professional history, highlight allegations linking to ‘unsuitable investments’ among others.
Understanding FINRA Rule 2150 in Simple Terms
To understand the gravity of the allegations, we need to understand a key piece of legislation – FINRA Rule 2150. This rule forbids any FINRA member or associated person from improperly using a customer’s funds or securities. It also bars any guarantees against a customer’s loss or any act that involves sharing in the profits or losses of a customer’s account.
In our context, while not commenting definitively on Engler’s guilt or innocence, it’s safe to say that allegations against him indicate a potential violation of this rule.
Consequences and Lessons Learned
In this case, the primary consequence for Engler was a complete bar from associating with any FINRA member, which essentially ended his career as a financial advisor.
However, beyond one advisor’s professional downfall, broader implications and lessons exist for the entire investor community. You, the investor, must constantly stay informed and vigilant about your advisor’s actions. This case serves as a stark reminder of the importance of researching and verifying the background and credibility of investment advisors. I cannot emphasize enough the importance of FINRA’s BrokerCheck tool, a free online resource to research financial advisors’ history, licensing status, and other data.
For skeptical or novice investors, the allegations against Engler may make an already convoluted world of financial advisement seem daunting. But remember that this case is an exception, not a rule. As Benjamin Graham, Warren Buffet’s mentor, said, “Investment is most intelligent when it is most businesslike.”
As a seasoned professional in finance and legal regulations, I urge investors to use the resources available to safeguard their capital and, more importantly, their trust in the financial markets.
John Engler Sr.’s BrokerCheck records can be accessed via this link.
