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SagePoint Financial (CRD#: 133763) has many different complaints filed by the U. S. Securities and Exchange Commission (SEC), Financial Industry Regulatory Authority, (FINRA), state regulatory organizations, and investors such as yourself. At the Law Offices of Robert Wayne Pearce, we have investigated SagePoint Financial, its regulatory and customer complaints, and 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 SagePoint Financial, 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 SagePoint Financial?

If you’ve lost money caused by SagePoint Financial and/or its employees’ misconduct then the answer is, YES,  you can sue SagePoint 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 SagePoint Financial in FINRA arbitration proceedings, but WIN that arbitration.

You’ve lost money. The easiest way to know if you have a viable case against Sagepoint Financial is to call our office at 800-732-2889.

What Is SagePoint Financial?

The company was founded in 2005 and has been engaged in its broker-dealer and investment advisory businesses since that time. It is indirectly controlled by American International Group, Inc. (“AIG”) and headquartered in Phoenix, Arizona with 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 550 SagePoint Financial branch offices with over 1000 registered representatives in almost every state. It is now one of the largest broker-dealer and investment advisory firms in the United States.

SagePoint Financial Has Had Many Different Regulatory Problems 

SagePoint Financial’s rapid growth has not been without consequences. There have been at least 14 Federal, state and self-regulatory body disclosure events; that is, 14 final and formal proceedings initiated by a regulatory authority (e.g., a state or federal securities agencies like the SEC, FINRA, and states who are members of 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 SagePoint 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. SagePoint Financial is a repeat offender: there are at least 14 SEC, FINRA and state reported disciplinary proceedings citing the firm with one form of supervisory lapses or another in the last decade.

A Brief Overview of Some of the Regulatory Problems Sagepoint Financial Has Faced Over the Years*

SagePoint 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 SEC and FINRA investigations for its misconduct are below:

SEC Orders Sagepoint Financial And Its Affiliates To Pay Over $2 Million To Investors

This proceeding arises from breaches of fiduciary duty and multiple compliance failures by SagePoint Financial in its fee based advisory business. During the relevant period, SagePoint Financial invested advisory clients in mutual fund share classes with 12b-1 fees instead of lower-fee share classes of the same funds that were available without 12b-1 fees. The affected clients were advisory clients whom SagePoint Financial invested in a fee-based advisory service called the Advisor Managed Portfolio (“AMP”) in accounts that are not qualified retirement or ERISA accounts, where 12b-1 fees are rebated. In its capacity as a broker-dealer, SagePoint Financial received 12b-1 fees paid by the funds in which AMP advisory clients invested. By investing these non-qualified advisory clients in the higher-fee share classes, SagePoint Financial and its affiliates received approximately $2 million in 12b-1 fees that they would not have collected from the lower-fee share classes. SagePoint Financial failed to disclose in their Forms ADV or otherwise that they had a conflict of interest due to a financial incentive to place non-qualified advisory clients in higher-fee mutual fund share classes. As a result, SagePoint Financial breached its fiduciary duty as an investment adviser to certain of their AMP advisory clients by investing them in higher-fee mutual fund share classes. In addition, Sagepoint Financial failed to adopt any compliance policy governing mutual fund share class selection. It also failed to monitor advisory accounts quarterly for inactivity or “reverse churning” as required under their compliance policies and procedures to ensure that fee-based advisory or “wrap” accounts that charged an inclusive fee for both advisory services and trading costs remained in the best interest of clients that traded infrequently. This conduct violated Section 206 of the Investment Advisors Act of 1940.

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FINRA Censures, Fines, And Orders Sagepoint Financial To Pay Over $1.3 Million To Investors

During the relevant period, SagePoint Financial failed to establish and maintain a supervisory system and failed to establish, maintain, and enforce written supervisory procedures (WSPs) that were reasonably designed to supervise the suitability of representatives’ recommendations to customers for early rollovers of Unit Investment Trusts. Based on the foregoing, SagePoint Financial violated NASD Rule 3010 (for conduct before December 1, 2014), FINRA Rule 3110 (for conduct on or after December 1, 2014), and FINRA Rule 2010.

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Sagepoint Financial Censured, Fined, And Ordered By FINRA To Pay Restitution To Charities It Cheated

During the relevant period, SagePoint Financial disadvantaged certain retirement plan and charitable organization customers that were eligible to purchase Class A shares in certain mutual funds without a front-end sales charge (“Eligible Customers”). These Eligible Customers were instead sold Class A shares with a front-end sales charge or Class B or C shares with back-end sales charges and higher ongoing fees and expenses. During this period, SagePoint Financial failed to establish and maintain a supervisory system and procedures reasonably designed to ensure that Eligible Customers who purchased mutual fund shares received the benefit of applicable sales charge waivers. As a result, SagePoint Financial violated FINRA Rule 3110 (for misconduct on or after December 1, 2014), and FINRA Rule 2010.

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FINRA Censures And Fines Sagepoint Financial For Multi Share Variable Annuity Sales Abuse

SagePoint Financial failed to establish, maintain and enforce a supervisory system and written procedures designed to reasonably supervise representatives’ sale of multi-share class variable annuities and failed to provide training to its representatives and principals on the sale and supervision of multi-share class variable annuities. As a result, the Advisor Group Firms violated FINRA Rules 2330(d) and (e), and F1NRA Rule 3110 (for conduct on and after December 1, 2014), and FINRA Rule 2010.

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FINRA Censures And Fines Sagepoint Financial For Suitability And Supervisory Rule Violations

During the relevant period, approximately 3,925 employees of a California County Office of Education (“CCOE”) were enrolled into a Deferred Compensation Program by SagePoint Financial registered representatives (“RRs”) who offered the participants detailed asset allocation advice and provided specific investment recommendations but did not record the customers’ investor profile information on a customer account application and did not require that the RRs maintain any customer files relating to the participants’ enrollment into the Plan. As a result, the Firm did not maintain or preserve records that would allow supervisory or other review of the RRs’ recommendations to determine whether they complied with the suitability requirements. Therefore, the Firm failed to implement an adequate supervisory system, including written procedures, reasonably designed to comply with NASD Conduct Rules 2310(a) and 3110(a) and Section 17(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) in violation of NASD Conduct Rules 3010 (a) and (b) and 2110. Moreover, the Firm failed to make and keep customer account information in connection with the enrollment process in violation of NASD Conduct Rules 3110(a) and 2110 and Section 17(a) of the Exchange Act, Rule 17a-3 thereunder.

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*Above are only some of the regulatory disciplinary actions filed against SagePoint Financial by FINRA. NASSA and other state securities regulator investigations and enforcement actions account for more BrokerCheck disclosures.

Sagepoint Financial Customer Complaints

There have been scores of customer complaints filed against Sagepoint Financial stockbrokers and investment advisors over the years. We have launched many investigations of current and former Sagepoint Financial advisors:

If you have lost money investing with any of these Sagepoint Financial 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 SagePoint Financial 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 person 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 SagePoint Financial 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. SagePoint 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 SagePoint Financial without attorney representation about their complaints and have their complaints denied.

A Sagepoint Financial denial of your claim does not mean it was not a valid claim!

All brokers have a conflict of interest when it comes to complaints.

Call us now for an unbiased evaluation of your claim at 800-732-2889.

Consult With An Attorney Who Recovers Investment Losses Caused By SagePoint Financial Advisors Today!

The 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 SagePoint 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.

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