American Portfolios Financial Services, Inc. (“American Portfolios”) (CRD# 18487) has many different complaints filed by FINRA (Financial Industry Regulatory Authority), state regulatory organizations, and investors such as yourself. At the Law Offices of Robert Wayne Pearce, we have investigated American Portfolios, its regulatory and customer complaints, and have also represented investors with claims of fraud, negligence, and breach of fiduciary duty against this organization and its financial advisors.
If you believe you have a claim against American Portfolios, you should strongly consider hiring an investment loss lawyer. You should not wait until it’s too late to file a claim. The Law Offices of Robert Wayne Pearce, P.A., offers free consultations. Give us a call at 800-732-2889. Let’s discuss your case and see what we can do to help you get the compensation you need and deserve.
Can I Sue American Portfolios Financial Services, Inc.?
If you’ve lost money caused by American Portfolios and/or its employees’ misconduct then the answer is, YES, you can sue American Portfolios but the odds are you signed away your right to sue in court and agreed to resolve your dispute in a FINRA arbitration proceeding. Attorney Robert Wayne Pearce has over 40 years of personal experience in FINRA arbitration proceedings and knows very well how you can not only sue American Portfolios in FINRA arbitration proceedings, but WIN that arbitration. The easiest way to know if you have a viable case against American Portfolios is to call Attorney Pearce at our office at 800-732-2889.
What is American Portfolios Financial Services, Inc.
American Portfolios (CRD# 18487) has been registered with the SEC and FINRA as a broker-dealer since 1987. The company is controlled by American Portfolios Holdings, Inc. and headquartered in Holbrook, Long Island, New York with smaller branch offices located throughout the United States. Its independent broker-dealer Business Model has grown through acquisition and organic development of primarily one and two person registered representative offices supervised remotely. Today there are over 400 American Portfolios branch offices with over 850 registered representatives in every state. It is now one of the 50 largest independent broker-dealer and investment advisory firms in the United States.
American Portfolios Financial Services, Inc. Has Many Different Regulatory Problems
American Portfolios’ rapid growth has not been without consequences. There have been approximately 5 Federal, state and self-regulatory body disclosure events; that is, final and formal proceedings initiated by a regulatory authority (e.g., a state or federal securities agency like the U.S. Securities and Exchange Commission (SEC) or self-regulatory body like the Financial Industry Regulatory Authority (FINRA) and the North American Securities Administrators Association (NASAA) ) for a violation(s) of investment-related rules or regulations. In addition, there have been scores of customer complaints filed against American Portfolios for misconduct by its securities sales and investment advisory representatives that are not reported by the firm on its Central Depository Record.
We have reported and written about these regulatory problems and customer complaints over many years. American Portfolios is a repeat offender: there are 4 FINRA reported disciplinary proceedings citing the firm with one form of supervisory lapses or another.
A BRIEF OVERVIEW OF SOME OF THE REGULATORY PROBLEMS AMERICAN PORTFOLIOS FINANCIAL SERVICES HAS FACED OVER THE YEARS*
American Portfolios has been repeatedly censured, warned, and fined over $700,000 for its own misconduct and failure to supervise its army of financial advisors.* A few of the notable FINRA Sanctions for its Supervisory Failures are below:
SEC Fined American Portfolios $650,000 For ETP Sales Abuses
The SEC investigated American Portfolios supervisory practices and procedures related to complex Exchange Traded Products (ETPs) and found the firm failed to supervise certain financial advisors who recommended their brokerage customers buying hold complex ETPs without a reasonable basis for believing the recommendation was suitable for their customers who suffered substantial losses. The SEC found that the broker-dealers registered representatives did not understand the nature, mechanics, or risks of ETPs, particularly, the S&P 500 VIX Short-Term Futures ETN. As a result of the broker-dealer’s failure to that the product and train the financial advisors, the SEC found that the product was misrepresented and unsuitable recommendations were made to investors.
The SEC concluded the foregoing misconduct constituted violations of sections 17 (a) (2) and 17 (a) (3) of the Securities Act of 1933, and that if American Portfolios had reasonably implemented his policies and procedures with respect to complex ETPs, the broker-dealer could have prevented and detected the brokerage representatives violations. Consequently, the SEC imposed a censure and fine $650,000 upon American Portfolios.
FINRA Sanctions American Portfolios For Mutual Fund Sales Abuse
FINRA Investigated American Portfolios, and discovered that the broker-dealer through two of its registered representatives, violated NASD Conduct Rule 2310, IM-2310-2, and FINRA Rules 2111 and 2010 by engaging in unsuitable mutual fund switching. Further, FINRA Found American Portfolios additionally violated NASD Conduct Ride 3010 and FINRA 2010 by failing to establish and enforce a supervisory system, including written supervisory procedures (“WSPs”), reasonably designed to detect and prevent unsuitable mutual fund switching. American Portfolios was censured and fined $50,000 for its supervisory failures and its employees’ misconduct.
FINRA Sanctions American Portfolios For UIT And ETF Disclosure Failures
During one of FINRAs audits of American Portfolios it discovered the broker-dealer had inadequate supervisory systems and procedures to ensure that it timely delivered the appropriate disclosure documents to customers purchasing unit investment trusts (”UITs”) and/or exchange traded funds (“ETFs”). As a result, American Portfolios failed to timely provide certain of its customers with a prospectus or written description for these transactions. The foregoing constituted violations of NASD Rules 3010 and 2110 and FINRA Rule 2010.1 for which American Portfolios was censured and fined $25,000.
*Above are only some of the regulatory disciplinary actions filed against American Portfolios by FINRA. There are at least 2 more SEC, FINRA, NASSA and/or other state securities regulator investigations and enforcement actions reported on BrokerCheck as regulatory disciplinary proceeding disclosures.
American Portfolios Financial Services Customer Complaints
There have been scores of customer complaints filed against American Portfolios stockbrokers and investment advisors over the years. We have launched many investigations of current and former American Portfolios Financial Services advisors:
- Jeffrey Miller of American Portfolios Financial Services, Inc.
- Mark Hopkins of American Portfolios Financial Services, Inc.
- Charles Darrow of American Portfolios Financial Services, Inc.
- Louise Fallica of American Portfolios Advisors
- Thomas Finnegan of American Portfolios Financial Services, Inc.
- Brian Dibrino of American Portfolios Financial Services, Inc.
- Michael Volini of American Portfolios Financial Services
- Mark Wojcinski of American Portfolios Financial Services
- Steven Maher of American Portfolios Financial Services
- Xavier Felipe of American Portfolios Financial Services
- Robert Halldin formerly with American Portfolios Financial Services
- Peter Knittle of American Portfolios Financial Services
- Joffre Salazar Formerly With American Portfolios Financial Services
- Carmine Lopresti of American Portfolios Financial Services, Inc.
- Gary Forrest formerly with American Portfolios Financial Services, Inc.
- Hillary Wertlieb of American Portfolios Financial Services, Inc.
- Joseph McGuire of American Portfolios Financial Services, Inc
- Louise Fallica of American Portfolios Financial Services, Inc.
If you have lost money investing with any of these American Portfolios advisors or others within this brokerage firm, it’s important that you reach out to an investment loss attorney quickly because the statutes of limitations can bar your claims. Call us at 800-732-2889.
Why Does American Portfolios Financial Services, Inc. Have So Many Regulatory Problems And Customer Complaints?
Independent broker-dealers are notorious for their lax supervisory practices and procedures. The business model of these franchise type operations is to open many offices nationwide for steady growth of fixed monthly revenues without the costs attendant to a full-service branch office with on-site manager, compliance officer and operation personnel. The registered representatives of these independent broker-dealers generally operate as separately incorporated businesses. They are not employees of the broker-dealer and therefore not controlled in the same manner as full-service brokerage firm representatives. The registered representatives control their structure and costs to maximize profits and often leave the protection of investors’ rights and interests as their lowest priority.
The typical supervisory organization of independent broker-dealer operations is to have other independent contractors operate Offices of Supervisory Jurisdiction (OSJs) to monitor the registered representatives from geographically remote offices and then report to the main franchisor’s compliance office at national headquarters. The supervisors at the OSJs are not employees of the franchisor and often run their own brokerage, insurance and other businesses. They are not devoted full-time supervisors of the smaller branch offices. Consequently, OSJ managers cannot and do not supervise the day-to-day operations of the registered representatives of these Independent broker-dealers.
Generally, there is no immediate review of new accounts opened, securities transactions, business records, cash or securities receipts and deliveries, correspondence and business activities unrelated to the securities brokerage operation at these independent brokerage firms. The lax supervision leaves investors who have transferred their accounts to the smaller independent broker-dealer vulnerable to sales of securities that have not been reviewed or authorized by anyone other than the sales representative earning a commission. There may be no one onsite to detect forgeries of clients’ signatures on documents, the placement of inaccurate information about a client’s investment objectives and financial condition to document the suitability of a particular investment recommendation. Oftentimes there is no daily review of sales literature and client correspondence to protect against misrepresentations and misleading statements being made to investors. In fact, it is not unusual for there to be only one compliance audit visit per year at many of these offices.
These Independent brokerage business operations are worrisome to the North American Securities Administrators Association (NASAA), which has documented more instances of sales abuse and consequently investor losses at these firms than the traditional brokerage firms with branch offices with on-site managers and compliance personnel.
Did American Portfolios Financial Services, Inc. Advisor Misconduct Cause You Investment Losses?
When financial advisor misconduct has caused you to lose substantial value to your investment accounts, you have the right to seek reimbursement from the responsible parties. American Portfolios is responsible like any employer for its financial advisors acts and omissions. In addition, it has an independent duty to supervise its stockbrokers and investment advisors. These cases can be extremely complex, and so having the support of a reputable attorney who is experienced in recovering investment losses for investors is key to your success. Many customers make the mistake of contacting American Portfolios without representation with an attorney about their complaints and have their complaints denied.
Related Read: Can You Sue Your Brokerage Firm?
Consult With An Attorney Who Recovers Investment Losses Caused By American Portfolios Financial Services, Inc. Today!
The securities attorneys at The Law Offices of Robert Wayne Pearce, P.A., have helped countless investors over the last 40 years recover the losses from their investment accounts that were caused by broker negligence or misconduct. The firm has extensive experience with American Portfolios cases, and Attorney Pearce is committed to seeing that those responsible for the losses you have suffered are held fully accountable.
Give us a call at 800-732-2889. Let’s discuss your case and see what we can do to help you get the compensation you need and deserve.