In a development that has sent shockwaves through the financial industry, Concourse Financial Group Securities (formerly known as Proequities Inc.), a prominent dual-registered national financial advisory firm, finds itself under the microscope due to a series of regulatory actions and customer complaints. With 69 disclosures on its broker record, including a staggering 64 regulatory actions and 5 arbitrations, the firm’s practices have raised eyebrows among investors and regulators alike.
The allegations against Concourse Financial Group are serious, ranging from mutual fund overcharges to failure to supervise recommendations of complex products. In March 2019, FINRA sanctioned the firm for allegedly disadvantaging certain retirement plan and charitable organization customers by selling them Class A shares with front-end sales charges or Class B or C shares with back-end sales charges and higher ongoing fees, when they were eligible for waived fees.
Furthermore, in August 2016, the firm faced censure and a $200,000 fine from FINRA for allegedly failing to supervise recommendations of complex products such as leveraged, inverse, or inverse-leveraged exchange-traded funds. This pattern of misconduct has not gone unnoticed, with the firm accumulating a total of $165,000 in fines from FINRA in November 2015 for failing to apply sales charge discounts to certain customers’ eligible purchases of unit investment trusts.
The ripple effect of these regulatory actions extends beyond just the firm itself. Registered representatives employed by Concourse Financial Group have also found themselves embroiled in allegations of broker misconduct and fraudulent activities. Jon Peter Lindberg (CRD#: 1085475), a former Proequities advisor, currently faces two pending regulatory actions for alleged fraud, unsuitable recommendations, and breach of fiduciary duty in Montana and Alabama. These actions, initiated in May 2020 and April 2019 respectively, paint a troubling picture of the firm’s supervisory practices.
Lindberg’s case is not an isolated incident. In 2018, an investor FINRA Dispute Resolution claim against Proequities, Inc. on behalf of a client, alleging violations of common law fraud, breach of fiduciary duty, negligence, and negligent supervision in relation to unsuitable investments in high-risk oil and gas private placements. The financial advisor at the center of this claim, Bradley Freimark, reportedly has a staggering 25 customer complaints on his record, with allegations ranging from fraud and negligence to misrepresentation and unsuitable investments.
The responsibility for these actions does not lie solely with the individual brokers. Under FINRA Rule 3110, broker-dealers have a duty to adequately supervise their employees and implement necessary procedures and systems to detect misconduct. Concourse Financial Group’s failure to effectively supervise its brokers has exposed the firm to potential liability for investment losses incurred by clients due to negligent supervision.
As an investor navigating this complex landscape, it is crucial to remain vigilant and informed. If you suspect that your broker has engaged in misconduct or fraudulent activities, filing a claim with FINRA for arbitration may be a viable path to seek resolution and potential recovery of investment losses. However, the process can be complex and technical, making it essential to seek the guidance of experienced securities attorneys who specialize in FINRA arbitration, such as those at Financial Advisor Complaints.
As the regulatory actions against Concourse Financial Group and its registered representatives continue to unfold, investors must remain proactive in protecting their rights and interests. By staying informed, conducting thorough due diligence, and seeking the counsel of experienced securities attorneys when necessary, investors can navigate this challenging landscape with greater confidence and a heightened sense of protection.
“It’s not about the money. It’s about the investor’s peace of mind.” – Christopher Gerold, Chief of the New Jersey Bureau of Securities
Fact: According to a study by the National Association of Retirement Plan Participants, 40% of investors who received bad advice from a financial advisor lost a significant portion of their retirement savings. This highlights the importance of thoroughly researching and vetting financial advisors before entrusting them with your investments.
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