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Award Date: August 19, 2021
Hearing Site: Los Angeles, California
Respondent Firm: UBS Financial Services Inc.
Claimant Representative: AdvisorLaw, LLC.
Case Objective:
A California advisor had a customer dispute on his record that was over 20 years old. The claim had primarily concerned the advisor’s former partner, who had been terminated prior to the claim being lodged. Yet our advisor spent over two decades with allegations of unauthorized purchases on his record.
Case Summary:
In early 2000, clients of the advisor and his partner purchased three mutual funds that the team had recommended. The mutual funds comprised less than two percent of the customers’ overall, balanced portfolio. The customers authorized the purchases of the mutual funds, and the recommendations were approved by a manager. The mutual funds declined significantly along with the market, and the advisor’s partner was terminated. Our advisor resigned and, two weeks later, was hit with a customer dispute alleging that the mutual funds had been purchased without the customers’ approval. The firm settled the claim for less than $5,000.
Result:
After hearing the testimony, the Arbitrator recommended the expungement of the decades-old dispute from the advisor’s record. The Arbitrator found that the allegations were false and cited as part of his reasoning the very thorough process through which the customers had been informed of the advisors’ recommendations and authorized the trades. The Arbitrator determined that the complaint held no regulatory or investor protection value and that its expungement would have no material adverse effect.
The advisor now has a completely clean record, reflective of his career.
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