It’s no secret that the world of finance can be labyrinthian in its complexity, and recent events surrounding a specific Houston, Texas, stockbroker, Mr. Gihan Anil Fernando, have only served to bring this truth into sharper focus. I’m here to help break down the intricate legal and financial underpinnings of the case, and to shed some light on its potential impacts.
Understanding the Allegations and Their Potential Impact
Gihan Anil Fernando, a seasoned financial advisor who has served in various reputable firms such as BOK Financial Securities and Morgan Stanley Dean Witter, has found himself in the eye of the storm. While he has not been officially sanctioned by the Financial Industry Regulatory Authority (FINRA), he appears to be embroiled in a number of customer disputes.
Remarkably, Fernando has already settled 33 prior customer disputes, with total payments exceeding $3.4 million. It comes as no surprise that these settlements have caused a stir amongst investors, triggering a barrage of questions concerning Fernando’s professional ethics and possible violations.
The crux of these disputes, mostly settled in 2023, rests primarily on allegations that Fernando misrepresented alternative investments during the sales process. Such investments ranged from real estate investment trusts (REITs) to business development companies (BDCs) sold between 2014 and 2018.
As we speak, two additional customer complaints are ongoing, both echoing claims of misrepresentation during the sales of real estate investment products. If proven, this could lead to further settlements, shaking investor confidence and possibly tainting Fernando’s reputation.
About Fernando and His Broker-Dealer
Fernando is unquestionably an experienced player in the financial arena. His tenure at BOK Financial Securities stretched from March 2003 to November 2023, after which he transferred to Cetera Investment Services in January 2024. Yet, his impressive long-service does not eclipse the critical fact that complaints lodged against him point towards serious breaches of trust and professional misconduct.
BOK Financial Securities, Fernando’s long-term base, is a reputable firm with a rich history tracing back to 1919. Yet, its stature has not shielded it from the controversy surrounding Fernando. Furthermore, the firm itself occupies a prominent position on NASDAQ under BOK Financial Corporation (BOKF) and boasts a respected team of professionals, including President Brett Alan Dean and CEO Scott Bradley Grauer.
Breaking Down the FINRA Rule
FINRA, as many of you might know, operates as a private corporation that acts as a self-regulatory organization. It mandates the reporting of customer complaints and disputes, along with regulatory sanctions, by both brokers and brokerage firms.
The alleged wrongdoing of Fernando falls neatly within FINRA’s purview, and if proven, it signifies a clear breach of the rules and regulations set out by this agency. In simple terms, Fernando stands accused of misrepresenting the nature and potential returns of various “alternative investments” to his customers.
The Aftermath and Key Takeaways
The dust has not yet settled around the disputes involving Fernando and his former customers. That said, this case offers a compelling reminder of the importance of vigilance and informed decision-making in investing. As billionaire businessman Warren Buffett once remarked, “It’s good to learn from your mistakes. It’s better to learn from other people’s mistakes.”
One sobering statistic is that nearly 7% of financial advisors have been involved in misconduct, signifying potential risks that are not isolated to Fernando or Texas. As investors, we must remember that knowledge is the most powerful tool we can wield in the world of finance. Examining the details of an advisor’s experience, credentials, and past complaints is crucial. And so is staying informed about cases like Fernando’s, which serves as harsh reminders of the potential pitfalls in our path towards financial growth.
In the Light of Transparency…
Detailed information regarding Mr. Fernando, including his background and professional history, is readily accessible via FINRA’s BrokerCheck and can be accessed with his unique identifier, CRD 4469669. In the spirit of transparency and accountability, it behooves us as responsible investors to keep a keen eye on such matters, allowing us to make informed, intelligent investment decisions.
