Securities Lawyers Blog
According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker Peter Glowacki (Glowacki), previously associated with Tcfg Wealth Management, LLC, has at least one disclosable event. These events include one tax lien, alleging that Glowacki recommended unsuitable investments in different investment products including debt securities among other allegations and complaints.
FINRA BrokerCheck shows a final customer complaint on November 21, 2024.
Without admitting or denying the findings, Glowacki consented to the sanctions and to the entry of findings that he exercised discretionary authority when placing 105 trades in accounts belonging to nine customers without first obtaining prior written authorization from the customers and having the accounts accepted as discretionary by his member firms. The findings stated that Glowacki discussed his trading with the customers generally, he did not speak with the customers about the specific trades on the dates of the transactions. The findings also stated that Glowacki used an unapproved channel for securities-related communications. Glowacki communicated about securities business via text message from his personal cell phone with firm customers, including confirming executed trades, discussing investment ideas and recommendations, accepting orders, and transferring funds. Glowacki did not provide those text messages to his firm for review or retention and caused the firm to maintain incomplete books and records.
Under the securities laws brokers are obligated to act in their clients’ best interests and provide only suitable recommendations for investments to the client. In addition, the SEC has promulgated ‘Regulation Best Interest (Reg BI)‘ which according to the SEC enhanced the broker-dealer standard of conduct beyond existing suitability obligations and requires broker-dealers to act in the best interest of a retail customer when making a recommendation of any securities transaction or investment strategy involving securities. Regulation Best Interest and the fiduciary standard for investment advisers are drawn from key fiduciary principles that include an obligation to act in the retail investor’s best interest and not to place their own interests ahead of the investor’s interest.
Brokers have an obligation to first obtain and evaluate sufficient information about a retail investor to form a reasonable basis to believe the account recommendations are in the retail investor’s best interest. Recommendations cannot be based on materially inaccurate or incomplete information. Data on the investor and the expense of the advice are consistently part of material information. Types of costs that must be considered including account fees, commissions and transaction costs, tax considerations, as well as indirect costs.
In addition to obligation to understand the customer the broker must also investigate the product being sold. FINRA firms have an obligation to conduct a reasonable investigation of the issuer and the securities they recommend in offerings. A brokerage firm has a special relationship with a customer from the fact that in recommending the security, the broker represents to the customer that a reasonable investigation has been made. So, a brokerage firm should not depend solely on the issuer for data about a company instead of performing its own thorough review.
To protect investors, it should be required to mandate broker disclosures. Brokers are required to reveal important events, such as customer complaints, IRS tax liens, judgments, investigations, terminations, and even criminal matters, publicly on their BrokerCheck reports. FINRA has acknowledged that recent studies provide evidence of the predictability of future regulatory and customer complaint issues for brokers with a history of such events. FINRA’s Office of the Chief Economist (OCE) published a study showing the predictability of disciplinary and disclosure events based on past similar events. The OCE study showed that past disclosure events, including regulatory actions, customer arbitrations and litigations of brokers, have significant power to predict future investor harm. The data shows that where a member firm on-boards brokers with a significant history of misconduct there is a high likelihood that the broker will continue to engage in similar behavior.
Glowacki has been in the securities industry for more than 40 years. Glowacki has been registered as a Broker with Tcfg Wealth Management, LLC since 2023.
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.
