Missouri Advisor Wipes 4 Customer Disputes From His Records

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Award Date: January 26, 2023
Hearing Site: St. Louis, Missouri
Respondent Firm: Securities Service Network, LLC
Claimant Representative: Doc Kennedy, MBA, J.D.

Case Objective:

The first dispute arose in 2001, from customers who had only become clients of our advisor the year prior. The customers sought life insurance and tax deferral, and they purchased a suitable variable universal life insurance (VUL) policy recommended by the advisor. A year later, the advisor ended up with a customer dispute alleging unsuitability on his records, and the disputed status remained pending for more than 20 years. 

The second dispute arose in 2004, from customers who had only been with the advisor for a couple of years. Their portfolio had suffered around 2000, and they sought growth with a minimum of moderate risk tolerance. Over several meetings, the advisor made various recommendations, including a VUL. The customers purchased the VUL and subsequently wrote a letter to the advisor, outlining their concerns about how they were going to fund it. The firm flagged that communication as a complaint. While the customers wrote letters to the firm attesting to the fact that their letter had not been a complaint, the advisor had a “withdrawn” customer dispute on his record ever since.

The third dispute was also from a customer who had been with the advisor for only a few years. The advisor recommended a suitable variable annuity, which the customer purchased. In subsequent meetings with the advisor, the customer would consistently question why his other investments were outperforming the annuity. In 2007, the advisor ended up with another customer dispute alleging that he had failed to disclose the fact that he earned a commission on the sale. The claim was denied, but it remained on the advisor’s records, nonetheless.

As with the other three disputes, the customers who lodged the fourth claim were only clients of our advisor for a short time, as well. Of the recommended, suitable investments, these customers purchased a VUL. The husband later passed away, and the advisor complied with the wife’s request to lower the VUL’s face value. In 2008, the advisor was hit with a fourth disclosure, alleging unsuitability. The claim’s status on the advisor’s public records was listed as “Closed” or “No Action,” but its detrimental effects on the advisor’s reputation were significant.


The firm participated in the FINRA Dispute Resolution hearing on the matter, and it did not oppose the advisor’s expungement request. None of the customers attended or participated. As the claims were so old, the Arbitrator had only the advisor’s testimony and CRD record to reference. He listened to the arguments presented by AdvisorLaw’s Dochtor Kennedy, J.D., MBA and made a determination that all four occurrences should be expunged.

Regarding the first dispute, the Arbitrator cited that “Credible testimony by [the advisor] was to the effect that there was a personal matter unrelated to the VUL that resulted in a threat by the customers” and that “this CRD complaint was how the threat was accomplished.” The Arbitrator found, in the second dispute, that the advisor’s “credible testimony was to the effect that the customer fully understood the asset and its risks and the commission situation.” The recommendation for expungement of the third claim was based on the fact that the customers never intended their letter to be a complaint, “but mere inquiry.” The Arbitrator recommended the expungement of the fourth claim, as well, and closed his explanation by stating that the advisor “testified that he has dealt with thousands of customers since 1988. These are the only securities-related customer complaints on his CRD record. In each case, [the advisor] testified in a credible manner that he was honest, careful, and appropriate in his dealings with his customers.

All four customer disputes are already absent from the advisor’s public BrokerCheck report and CRD record, and he may now move into the rest of his career free from the burden of the four, meritless claims.

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Expungement Award