North Carolina Advisor Restores Perfect Public Records Through FINRA Expungement

• A North Carolina financial advisor successfully achieved FINRA expungement to remove a misleading customer dispute from his CRD and BrokerCheck records, restoring his perfect public record.
• Awarded June 23, 2025, this case highlights a successful FINRA Dispute Resolution where the panel found allegations against the advisor to be "factually impossible and false."
• Represented by Dochtor Kennedy, MBA, J.D., and Austin Davis, J.D., the financial advisor's record was cleared of inaccurate claims regarding fund transfers and risk tolerance, affirming adherence to FINRA Rule 2111 suitability standards.

In June 2024, a North Carolina-based financial advisor (FA) faced a customer dispute disclosure on his Central Registration Depository (CRD) and public BrokerCheck records. The disclosure inaccurately alleged that the FA had failed to follow a customer’s instructions regarding moving funds between accounts and reclassifying her risk tolerance, claiming a $45,000 loss. This misleading entry damaged the FA’s reputation and professional standing. With AdvisorLaw’s assistance, the FA pursued expungement through FINRA Dispute Resolution to clear his record.

The FA has been registered with Northwestern Mutual Investment Services, LLC for ten years — with a perfect record for nine of them. In 2018, the customer became a client through a referral, initially seeking life insurance and later financial advice for retirement planning. In December 2021, the customer opened a managed account with an aggressive, growth-oriented investment strategy, which was thoroughly discussed and agreed upon.

On December 29, 2022, the customer requested a year-end withdrawal to lower her health insurance premiums, which was not feasible due to insufficient notice and only one business day remaining in 2022. She ultimately declined to proceed with the withdrawal. In June 2024, she completed a client survey, referencing a $45,000 loss in her account due to market volatility in 2022, but she did not pursue formal damages or arbitration.

A corresponding customer dispute reported to the FA’s records alleged that he had failed to follow instructions related to fund transfers and risk tolerance reclassification. The dispute was listed as “Closed” or “No Action” by August 19, 2024, with no evidence supporting the allegations.

The FA’s Statement of Claim sought expungement under FINRA Rule 2080(b)(1)(A) and (C), arguing that the allegations were factually impossible or clearly erroneous and false. The expungement hearing was conducted via videoconference on June 18, 2025. Dochtor Kennedy, MBA, J.D. and Austin Davis, J.D. presented evidence, including the customer’s email and survey responses, alongside the FA’s sworn testimony. Northwestern Mutual did not oppose the expungement request, and the customer did not respond to follow-up inquiries.

The FINRA arbitration Panel reviewed the pleadings, testimony, and evidence, finding the allegations factually impossible and false. The customer’s withdrawal request could not be processed due to timing constraints, and no evidence supported claims of failure to follow instructions. The Panel concluded that the dispute arose from market-driven losses, not any conduct on the part of the FA, who had adhered to FINRA Rule 2111 suitability standards.

On June 23, 2025, the Panel ordered expungement of all references to the occurrence from the FA’s CRD and BrokerCheck records. The Panel’s decision removes the misleading disclosure, restoring the FA’s unblemished professional record and affirming his ethical conduct in financial services.

Facing a similar situation? Contact our team today for a complimentary consultation to evaluate your case. Our experts will assess the viability of expungement and guide you through the process.