First Allied Securities: Information for Investors

First-Allied-Securities--Information-for-Investors
First Allied Securities (CRD#: 32444) is a securities brokerage that is based in San Diego, California and operates nationwide. As of early January 2018, this broker-dealer had 31 disclosures listed on its Financial Regulatory Authority (FINRA) report. This includes 17 different regulatory events and 14 different FINRA Arbitration cases.

Below, our dedicated investor advocates have provided details regarding the six most recent regulatory disclosures that involve First Allied Securities. Please note that all of the information that is contained within this article has come directly from the official First Allied Securities BrokerCheck Report.

 

First Allied Securities: FINRA Disclosures

 

Disclosure # 1

Date: 08/21/2017

Reporting Source: Regulator

Initiated By: FINRA

Allegations: “Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it 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. The findings stated that 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. Many mutual funds waive the up-front sales charges associated with class A shares for certain retirement plans and/or charitable organizations. Some of the mutual funds available on the firm’s retail platform offered such waivers and disclosed those waivers in their prospectuses.”

Sanction Details: “The firm was censured, agreed to pay a total of approximately $876,915, inclusive of interest, in restitution to eligible customers, and will also ensure that retirement and charitable waivers are appropriately applied to all future transactions, and required to provide remediation to eligible customers.”

 

Disclosure # 2

Date: 11/02/2017

Reporting Source: Regulator

Initiated By: FINRA

Allegations: “Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it failed to maintain a process reasonably designed to supervise its registered representatives’ recommendation of multi-share class variable annuities (VAs) to its customers. The findings stated that despite the significant role that VA sales played in the respondent’s overall business, the firm failed to implement a supervisory system and procedures designed to reasonably ensure suitability in its multi-share class VA sales, including L-share contracts.”

Sanction Details: “The firm was censured, fined $950,000, and required to conduct undertakings. The firm was required to review and revise, as necessary.”

 

Disclosure # 3

Date: 10/19/2015

Reporting Source: Regulator

Initiated By: FINRA

Allegations: “Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it failed to identify and apply sales charge discounts to certain customers’ eligible purchases of unit investment trusts (UITs).”

Sanction Details: “The firm was censured, fined $325,000, and ordered to pay $689,647.34 in restitution to customers.”

 

Disclosure # 4

Date: 03/07/2015

Reporting Source: Regulator

Initiated By: Nevada

Allegations: “Between December 23, 2011 and October 9, 2014, the firm had two unlicensed branch offices in Nevada in violation of NAC 90. 392(1).”

Sanction Details: “Monetary/fine $6,000”

 

Disclosure # 5

Date: 01/17/2013

Reporting Source: Regulator

Initiated By: FINRA

Allegations: “The firm did not have adequate written procedures regarding the delivery of exchange traded fund (ETF) and unit investment trust (UIT) prospectuses. The firm failed to adequately review exception reports published by a company and failed to otherwise review and monitor the functions it delegated to the company. As a result, the firm failed to detect that the company failed to deliver approximately 1,107 prospectuses.”
Sanction Details: “Without admitting or denying the findings, the firm consented to the described sanctions and to the entry of findings; therefore it is censured and fined $40,000.”

 

Disclosure # 6

Date: 05/12/2010

Reporting Source: Regulator

Initiated By: FINRA

Allegations: “First Allied Securities, Inc. acted as a broker on behalf of its customers in variable life settlement transactions. In each of the transactions, FFP, acting through one of its registered representatives, utilized a firm-approved life settlement broker for the transaction. In each transaction, the firm provided the customer with a purchase agreement that stated the net purchase price that the customer was to receive for the life settlement transaction. At no time either before or after each variable life settlement did the firm inform the customer of the gross amount.”

Sanction Details: “Without admitting or denying the findings, the firm consented to the described sanctions and to the entry of findings; therefore it is censured and fined $27,500.”

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