George Puliafico (CRD#: 1158596) has been a broker registered with Raymond James Financial Services, Inc, in Walpole, MA since 1999. Puliafico’s CRD shows a pending customer complaint claiming $2 million in damages regarding account activity that is suspect of sector concentration in master limited partnerships (MLPs).
In addition, the complaint alleges negligence, breach of fiduciary duty, negligent supervision and breach of contract.
Sector Concentration Increases Risk
The concentration of portfolio assets into one sector is a risky practice. FINRA addresses concentration risk as, “the risk of amplified losses that may occur from having a large portion of your holdings in a particular investment, asset class or market segment relative to your overall portfolio.” If Puliafico was, in fact, over-concentrating customer accounts in MLP’s, he was subjecting them to increased risk.
Negligence in these types of complaints can not only apply to the broker, but also to the registered broker firm. Financial advisors have a duty to act in the best interests of their clients, and firms have the duty to oversee and supervise their brokers. The negligent supervision claim may also place liability on Raymond James Financial Services.
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