Vernon Litigation and Attorney Kristian Kraszewski recently filed another FINRA arbitration involving concentrations in high-risk alternative investments sold by Aaron Sevigny of United Planners Financial Services of America. According to FINRA BrokerCheck for Mr. Sevigny (CRD No. 4314368), his record reflects five disclosure events. FINRA has specifically reminded firms such as United Planners on alternative investment sales practices in Notice to Members 03-71 that:
Given the complex nature of NCIs [Non-Conventional Investments aka Alternative Investments] and the potential for customer harm or confusion, members are cautioned to ensure that their sales conduct procedures fully and accurately address any of the special circumstances presented by the sale of NCIs. Additionally, NASD is concerned that investors, particularly retail investors, may not fully understand the risks associated with these products.
FINRA went on to remind members offering Non-Conventional Investments such as REITs and other alternatives of their obligations to: (1) conduct adequate due diligence to understand the features of the product; (2) perform a reasonable-basis suitability analysis; (3) perform customer-specific suitability analysis in connection with any recommended transactions; (4) provide a balanced disclosure of both the risks and rewards associated with the particular product, especially when selling to retail investors; (5) implement appropriate internal controls; and (6) train registered persons regarding the features, risks, and suitability of these products.
If you, or one of your family members or friends, have suffered losses in alternative investments or REITs due to the unsuitable investment advice by your financial advisor, please contact one of our securities lawyers to discuss your rights.