A Financial Industry Regulatory Authority (FINRA) arbitration panel recently ruled in favor of Hahn Loeser Partner, Andrew S. May’s client, an investment advisor representative and former registered representative by awarding expungement of all references to this dispute from May’s client’s record. The FINRA panel found that Claimants’ claims were “factually impossible and clearly erroneous.” Due to the unique nature of this arbitration and a prior one, Claimants’ claims appeared on May’s client’s record twice. Once removed from the Central Registration Depository (CRD), the licensing and registration system used by FINRA, the SEC and other organizations, these adverse references will no longer be viewed by the investing public.
The compelling and uncontroverted testimony established that May’s client did not advise or aggressively solicit any high-risk and junk bonds, preferred stocks and structured products. This was further supported by testimony of a witness who established that Claimants were sophisticated investors with more than 30 years’ experience in the market, who dictated all decisions concerning their own accounts at all times. Additionally, the municipal bonds involved in this dispute represented 3 of approximately 208 bonds purchased and held by Claimants. The recommended securities were of investment grade quality and suitable for these customers. As such, any losses that may have been sustained by Claimants resulting from a downturn in the three individual nursing home sector bonds were most likely the result of unforeseeable market conditions i.e., COVID 19.
