Securities Lawyers Blog
According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker Joseph Beam (Beam), previously associated with Capital Investment Group, Inc., has at least 7 disclosable events. These events include 7 customer complaints, alleging that Beam recommended unsuitable investments in different investment products including debt securities among other allegations and complaints.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $225,000.00 on January 28, 2025.
GWG Holdings, Inc. filed Chapter 11 bankruptcy on April 20, 2022. The Statement of Claim alleged that the product recommended to, and purchased by clients, GWG L-Bonds, was unsuitable in nature. Allegations include violations of federal securities laws, violation of North Carolina Securities Act, violation of South Carolina Securities Act, breach of contract, common law fraud, breach of fiduciary duty and, negligence and gross negligence.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $28,000.00 on October 21, 2024.
GWG Holdings, Inc. filed Chapter 11 bankruptcy on April 20, 2022. Relative to specific investments made by clients, claims include breach of fiduciary duty, negligence and negligent misrepresentation, breach of contract, failure to supervise and, negligence – violation of Regulation Best Interest.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $175,000.00 on July 18, 2024.
GWG Holdings, Inc. filed Chapter 11 bankruptcy on April 20, 2022. Complaint alleges failure to conduct reasonable diligence related to an investment in GWG L-Bonds.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $357,000.00 on May 17, 2024.
[REDACTED]: Client purchased, on separate occasions in 2020 and 2021, a total of $55,000 of GWG Holdings, Inc. L-Bonds. GWG Holdings filed Chapter 11 bankruptcy on April 20, 2022.Complaint alleges violations of federal securities laws; violation of NC Securities Act; breach of contract; common law fraud; breach of fiduciary duty, and; negligence and gross negligence. The compensatory damage amount listed in the Statement of Claim was, in total, for four separate clients of the firm, of which [REDACTED] was one. The other three customers were of other representatives, not Mr. Beam. The damage amount for [REDACTED], specifically, was $55,000.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $195,000.00 on May 15, 2024.
GWG Holdings, Inc. filed Chapter 11 bankruptcy on 04/20/2022. Complaint alleges unsuitable investments, failure to act in the best interest of the Claimants, misrepresentations and omissions, breach of fiduciary duty, breach of contract, failure to supervise, negligence and violation of federal and state securities laws, as related to the sale of GWG L Bonds.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $400,000.00 on April 18, 2024.
GWG Holdings, Inc. filed Chapter 11 bankruptcy on April 20, 2022. Complaint alleges failure to conduct reasonable due diligence on GWG L Bonds. The Statement of Claim only lists [REDACTED] as a claimant, but $300,000 of the bonds were purchased in a joint account with [REDACTED] in 06/2021.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $100,000.00 on November 16, 2023.
Product recommended and purchased by clients, GWG Holdings, Inc., was unsuitable in nature. Allegations include breach of contract and warranties, violation of state securities statutes, breach of fiduciary duty, claims under common law, and vicarious liability. For the purpose of full transparency, although the representative was not named as a respondent, he was clearly referenced in the Statement of Claim.
Brokers are required to adhere to the SEC’s Regulation Best Interest (Reg BI) standard of care under the Securities Exchange Act of 1934 which establishes a ‘best interest’ standard for broker-dealers and associated persons. This standard applies when brokers make recommendations to retail customer for any securities transaction or investment strategy involving securities, including recommendations of types of accounts. Reg BI is drawn from fiduciary principles that include an obligation to act in the retail investor’s best interest and the broker is prohibited from placing their own interests ahead of the investor’s interest.
There are several different aspects of the rule that brokers must comply with. One of which is the care obligations which requires brokers to form a reasonable belief that their investment advice and recommendations are in the retail investor’s best interest. The care obligations includes three components. First, the advisor must have an understanding of the potential risks, rewards, and costs associated with a product, investment strategy, account type, or series of transactions. Next, the advisor must have a reasonable understanding of the specific retail investor’s investment profile. The customer’s profile information generally includes an investor’s financial situation and needs; investments; assets and debts; marital status; tax status; age; investment time horizon; liquidity needs; risk tolerance; investment experience; investment objectives and financial goals; and any other information the retail investor may disclose in connection with the recommendation or advice. Using the foregoing information, the associated person then must consider reasonably available investment option to accomplish the investor’s goals as well as alternative investment options that may be cheaper or other important qualities. Finally, the advisor must conclude that there is a reasonable basis to believe that the recommendation being provided is in the investor’s best interest.
Finally, an advisor must also analyze the specific account features offered and determine whether their client can benefit from them in order to meet their care obligations. While securities and investments come with costs that must be considered, the type of securities account also has changes the cost equation for the investor and can change the retail customers’ future investment returns. The associated person must consider the different types of securities accounts for their client and determine whether or not the cost or features are reasonably needed for the client or if the customer’s current account costs and features are superior to solutions available to the advisor. In any event, the type of account and services recommended must be in the investor’s best interest.
Beam has been in the securities industry for more than 15 years. Beam has been registered as a Broker with Capital Investment Group, Inc. since 2013.
Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. At Gana Weinstein LLP, our attorneys are experienced representing investors who have suffered securities losses due to the mishandling of their accounts. Claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.
