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Award Date: July 26, 2024
Claimant Representatives: Dochtor Kennedy, MBA, J.D. and Harris Freedman, J.D.
Respondent Firms: Edward Jones and LPL Financial LLC
Case Objective:
An advisor out of Texas who has been in the industry for more than 25 years had two customer disputes on his otherwise flawless records—both of which were over a decade old. He hired AdvisorLaw to help him with expungement through FINRA Dispute Resolution.
Summary:
The first dispute arose in late 2000, and the allegations published in connection with it stated that the advisor had purchased three investments without the customer’s authorization. It went on to allege that the customer was upset about his account performance and claimed that the advisor and Edward Jones had been “asleep” during market downturns that affected the customer’s portfolio. The customer sought an explanation as to why certain stocks had been purchased. Edward Jones denied the claim a month later, yet it stayed on the advisor’s records.
The second dispute was lodged in 2009, and the allegation stated that the advisor had made unsuitable investment recommendations and executed mutual fund exchanges without authorization in 2009. LPL investigated and denied the claim, yet it, too, remained on the advisor’s records.
Resolution:
LPL did not participate in the advisor’s expungement hearing. Edward Jones did participate but did not take any position on the advisor’s request for expungement. The FINRA Arbitrator reviewed all of the written documents submitted. She listened to the advisor’s testimony, and Dochtor Kennedy, MBA, J.D., and Harris Freedman, J.D. presented their arguments in favor of expungement on the advisor’s behalf.
The Arbitrator noted in her award that the first customer “did not ever provide [information regarding] what trades were unauthorized.” She noted that there had been no settlement in the matter and, particularly, that “The customer was an experienced investor and was ‘letting off steam’ in filing the complaint.” She stated that the customer had received an explanation letter from Edward Jones advising that all trades had been authorized, that “No further action was needed” and that “The customer apologized to [the advisor] for filing.”
Regarding the second claim, the Arbitrator concluded that “The allegations were false[,]” as “The Customer signed a full discretion authorization form providing authorization for exchange of assets, no fees were incurred, and the account did not have any losses from the exchange.” The Arbitrator mentioned that “The Customer wanted funds for emotional loss,” and that the advisor had “made suitable investments that benefitted the Customer.”
The Arbitrator recommended the expungement of both disputes, and this advisor will soon be able to show off his perfect record for more than a quarter of a century.