Securities Lawyers Blog
Our securities fraud attorneys are investigating customer complaints filed with The Financial Industry Regulatory Authority (FINRA) against Samuel Koltun (Koltun) currently associated with RBC Capital Markets, LLC (RBC) alleging unsuitable investments in Puerto Rico municipal bonds among other claims. According to brokercheck records Koltun has been subject to six customer complaints and one regulatory action.
Puerto Rico municipal bonds are speculative investments based upon the deteriorating finances of the island. Many brokers have been accused of peddling these bonds in large concentrations to clients. In September 2016 a customer filed a complaint against Koltun alleging over concentration in Puerto Rico bonds from 2012 through 2015. The claim alleges $80,000 in damages and is currently pending. In another complaint filed in April 2016, the customer alleges $260,000 caused by overconcentration in Puerto Rico municipal bonds. The claim is currently pending.
Brokers in the financial industry have the fundamental responsibility to treat investors fairly. This obligation includes making only suitable investments for their client. The suitable analysis has certain requirements that must be met before the recommendation is made. First, there must be reasonable basis for the recommendation for the investment based upon the broker’s and the firm’s investigation and due diligence. Common due diligence looks into the investment’s properties including its benefits, risks, tax consequences, the issuer, the likelihood of success or failure of the investment, and other relevant factors. Second, if there is a reasonable basis to recommend the product to investors the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives. These factors include the client’s age, investment experience, retirement status, long or short term goals, tax status, or any other relevant factor.