Securities Lawyers Blog
Financial advisor Victor Lessinger (Lessinger), formerly employed by brokerage firm Colorado Financial Services Corporation (Colorado Financial) has been suspended by The Financial Industry Regulatory Authority (FINRA). In addition, Lessinger has been subject to at least four other regulatory complaints and one customer complaint during the course of his career.
In October 2024 Lessinger consented to a FINRA finding to the sanctions that he willfully violated Exchange Act Rule 15l-1(a)(1) by recommending that a retail customer invest in three high-risk closed-end management investment companies that were not in the customer’s best interest based on her investment profile. According to the FINRA findings the customer, who is a senior, reported that her risk tolerance was moderate, and her investment objective was income. But FINRA found that Lessinger recommended that the customer invest up to 37 percent of her net worth in the high-risk closed-end funds and as a result the customer lost $5,029.85.
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.