Fortune Financial Services, Inc. (“Fortune Financial”) (CRD# 42150) has many different complaints filed by FINRA (Financial Industry Regulatory Authority), state regulatory organizations, and investors. At the Law Offices of Robert Wayne Pearce, we have investigated Fortune Financial, 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 Fortune Financial, you should strongly consider hiring an investment fraud 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 Fortune Financial Services, Inc.?
If you’ve lost money caused by Fortune Financial and/or its employees’ misconduct then the answer is, YES, you can sue Fortune Financial 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 Fortune Financial in FINRA arbitration proceedings, but WIN that arbitration. The easiest way to know if you have a viable case against Fortune Financial is to call Attorney Pearce at our office at 800-732-2889.
What is Fortune Financial Services, Inc.?
Fortune Financial (CRD# 42150) has been registered with the SEC and FINRA as a broker dealer since 1997. The company is controlled by the Blake Daniels and Gregory Bentley and headquartered in Monaca, Pennsylvania with small 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 250 registered representatives in every state. It is now one of the 50 largest independent broker-dealer and investment advisory firms in the United States.
Fortune Financial Services, Inc. Has Many Different Regulatory Problems
Fortune Financial rapid growth has not been without consequences. There have been approximately 3 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 Fortune Financial 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. Fortune Financial is a repeat offender: there are at least 2 FINRA reported disciplinary proceedings citing the firm with one form of supervisory lapses.
A BRIEF OVERVIEW OF REGULATORY PROBLEMS FORTUNE FINANCIAL SERVICES, INC. HAS FACED
Fortune Financial has been repeatedly censured, warned, and fined 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:
Fortune Financial Sanctioned By FINRA For Supervisory Lapses
During the course of a FINRA audit, staff discovered that Fortune Financial effected transactions in municipal securities even though it was not properly qualified under the rules of the Municipal Securities Rulemaking Board (“MSRB”), and it failed to establish a supervisory system and written supervisory procedures (“WSPs”) to supervise municipal securities transactions. FINRA staff also discovered that Fortune Financial failed to conduct required branch office inspections, provide for reasonable review of correspondence, and retain all written correspondence. In addition, Fortune Financial failed to establish written procedures reasonably designed to supervise, and to record, representatives’ approved participation in private securities transactions. Moreover, FINRA found that Fortune Financial also failed to establish, maintain and enforce a reasonably designed system of supervisory control policies and procedures, and it failed to prepare a proper annual CEO certification. Finally, FINRA found that Fortune Financial failed to approve, prior to use, seven web sites established by representatives associated with the firm. FINRA concluded that all of this conduct violated MSRB Rules G-2, G-3 and G-27, Rule 17a-4 of the Securities Exchange Act of 1934 (Exchange Act), NASD Conduct Rules 3010, 3012, 3040, 3110 and 2210 and FINRA Rules 313 0 and 2010 and sanctioned the brokerage firm, by imposing a censure and a $45,000 fine.
Fortune Financial Sanctioned By FINRA For Supervisory Failures
In another FINRA investigation, the regulator discovered that Fortune Financial failed to: retain electronic communications relating to the firm’s business; obtain prior FINRA approval for a material change in business operations; register branch offices; and establish, maintain and enforce a supervisory system and/or written supervisory procedures that were reasonably designed to achieve compliance with all rules and regulations applicable to the firm’s business.
As a result, FINRA concluded that Fortune Financial violated Rule 17a-4 of the Securities Exchange Act of 1934 (“Exchange Act”) and FFS and Daniels violated NASD Conduct Rule 3110 (“Rule 3110”), NASD Membership and Registration Rule 1017 (“Rule 1017”), NASD Conduct Rule 3010 (“Rule 3010″) and NASD Conduct Rule 2110 (“RuIe 2110”), and censured and fined the brokerage firm $125,000.
*Above are only some of the regulatory disciplinary actions filed against Fortune Financial by FINRA. There is at least one more SEC, FINRA, NASSA, and/or state securities regulator investigations and enforcement actions reported on BrokerCheck as regulatory disciplinary proceeding disclosures.
Fortune Financial Services Customer Complaints
There have been many complaints filed against Fortune Financial stockbrokers and investment advisors over the years. We have launched a number of investigations of current and former Fortune Financial advisors, including:
- Michael Giokas formerly with Fortune Financial Services
- Jonathan D. Freeze of Fortune Financial Services, Inc
- Lafayette Randle of Fortune Financial Services
- Richard Wesselt formerly with Fortune Financial Services, Inc.
- Susan Ezekiel formerly with Stifel, Nicolaus & Company, Incorporated
- Vincent Grucci formerly with Fortune Financial Services, Inc
- Ross Hoffman of Fortune Financial Services, Inc.
If you have lost money investing with a Fortune Financial advisor 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 Fortune 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 Fortune 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. Fortune Financial 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 Fortune Financial 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 Fortune 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 Fortune Financial 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.