North Carolina Advisor Removes 20-Year-Old Settled Dispute

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Award Date: August 5, 2022
Hearing Site: Cleveland, Ohio
Respondent Firm: Pruco Securities, LLC
Claimant Representative: Doc Kennedy, MBA, J.D.

Case Objective:

A North Carolina-based advisor with over three decades of experience in the financial services industry had a 20-year-old customer dispute on his public record. The advisor hired AdvisorLaw to seek expungement of the disclosure through FINRA arbitration.

Case Summary:

At the very beginning of his career, our advisor inherited a customer account from the customer’s previous advisor. The customer was approximately in her 70s, and our advisor recommended a modified premium variable universal life policy based on the customer’s investor profile and objectives. Our advisor explained all of the details of the policy to the customer and provided her with all applicable written materials, which she signed. Notably, our advisor did not and never would represent such a policy or a living benefit as long-term-care insurance, and he specifically explained the way that the policy’s premiums worked.

The customer purchased the recommended policy in 1993. In 1995, our advisor transferred his registration to another firm, and the customer ceased to be a client of his. Then, in 2002, thirteen years into his career, our advisor was hit with a customer dispute disclosure when the customer claimed that our advisor had misrepresented the policy by allegedly selling it as “nursing home” insurance and representing that the premiums would never exceed $1,500 per year. The firm settled with the customer as a business decision for about $15,000, and our advisor lived with the disclosure on his public BrokerCheck record for the next two decades.


The FINRA Dispute Resolution Arbitrator focused on the materials provided and listened to the advisor’s testimony during the hearing, along with arguments presented by Dochtor Kennedy, MBA, J.D. The Arbitrator made the determination that “[t]he documents in the record does not support the Customer’s claims at the time of sale,” as our advisor testified that “the 74-year-old Customer did not say the things alleged at the time of sale or for nearly ten years after the sale,” and she “was not confused or unhappy with her purchase prior to filing the customer dispute.” Finding that “[t]he exhibits in the record and the credible and unrefuted testimony of [our advisor] contradict the CRD claims,” the Arbitrator also noted that “[t]his is the only customer complaint against [the advisor] over a career of several decades.”

With the Arbitrator’s conclusion that “[t]he claims were clearly erroneous and false, as necessitated by Rule 2080,” our advisor’s records will soon be customer-dispute-disclosure free — for the first time in two decades — thanks to AdvisorLaw.

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Expungement Award