FINRA Expungement Award:

36-Year Veteran Advisor Restores Perfect Record With Expungement Of Settled Customer Dispute Disclosure


FINRA Expungement Award:

36-Year Veteran Advisor Restores Perfect Record With Expungement Of Settled Customer Dispute Disclosure


 

*If you're under FINRA or SEC investigation, or if you have a meritless disclosure on your BrokerCheck, CRD, IARD, or IAPD record, call us right now at (303) 952-4025, or contact us to talk with an attorney and receive a priority consultation at no charge.


Award Date: July 27, 2022
Hearing Site: New York, New York
Respondent Firm: Lincoln Financial Advisors Corporation
Claimant Representative: Samantha Pastor, J.D. and Doc Kennedy, MBA, J.D.


Case Objective:

A New York advisor with nearly four decades in the financial services industry had a sole customer dispute on his public BrokerCheck record that had been settled for $350,000. He hired AdvisorLaw to seek expungement of the disclosure through FINRA Dispute Resolution.


Case Summary:

In 2002, a 64-year-old woman became a customer of our advisor and his brother. The advisor’s brother was the lead agent on the customer’s account. The customer owned a trust, and unbeknownst to our advisor, his brother was a co-trustee on the customer’s trust. In or around 2019, upon the customer’s death, the other co-trustee discovered that the advisor’s brother had made unauthorized withdrawals from the customer’s trust. The co-trustee then filed for FINRA arbitration, alleging that Claimant and his brother had breached their fiduciary duties in regard to an account for the benefit of the customer’s granddaughter. The co-trustee sought about $1.2 million in damages.



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In 2021, the firm settled with the co-trustee for $350,000. While less than the amount of damages sought, the settlement was substantial, and the dispute and settlement amount were reported to our advisor’s CRD and public BrokerCheck records.


Result:

During the FINRA arbitration hearing, the Arbitrator reviewed the documents that were submitted and listened to testimony from our advisors and the arguments presented by AdvisorLaw’s Dochtor Kennedy, MBA, J.D. and Samantha Pastor, J.D. The Arbitrator determined that “[i]t was apparent…that [our advisor] was not responsible for the unethical and potentially illegal taking of funds from the Customer, as [he had] had a passive role with the Customer’s account.

The Arbitrator recommended expungement pursuant to FINRA Rule 2080(b)(1)(B), which sets the standard for expungement in cases where “[t]he registered person was not involved in the alleged investment-related sales practice violation, forgery, theft, misappropriation, or conversion of funds.” Thanks to AdvisorLaw, our advisor’s spotless public records will soon be restored.





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