J.P. Turner & Company, LLC. was ordered by the Financial Industry Regulatory Authority (FINRA) to pay eighty- four of their customers a total of $707,559 in restitution after allegedly selling them unsuitable leveraged exchange trade funds (ETFs). FINRA alleged that J.P. Turner's failure to properly supervise the transactions caused their customers to lose money. FINRA also found that J.P. Turner neglected to provide satisfactory training to their employees regarding the ETFs.
Two Minnesota investors received a $6.2 million arbitration award against National Planning Corporation (NPC) that stemmed from a dispute over real estate investments. In February 2012, when the claim was filed, the couple alleged that their former NPC broker, Christopher Olsen, had negligently breached his fiduciary obligation by misrepresenting important facts regarding the investments in violation of applicable laws and industry rules.
The Financial Industry Regulatory Authority (FINRA) has reported that they will begin to put more focus on high risk brokers in an effort to improve investor protection. FINRA currently licenses 634,955 brokers, and of those 634,955 only 487,480 brokers possess clean records. The Wall Street Journal reported that at least 70,000 brokers have reportable offenses on their publicly available disciplinary record, known as their "CRD" and about 2,695 brokers have five to nine complaints and or regulatory actions on their record. In order to improve investor protection, FINRA uses an analysis called the "broker migration model" which traces brokers that have worked for firms that were expelled from the industry. So far under the new program, FINRA has barred sixteen brokers.
After wrongfully converting funds and failing to cooperate with the Financial Industry Regulatory Authorities' (FINRA's) investigation, two former JP Morgan Chase brokers were barred from the securities industry. Fernando Arevalo and Jimmy Caballero allegedly stole $300,000 from an elderly client. According to FINRA, the two did this by first selling two of her annuities and transferring that money into a new account that Arevalo had opened for her. From there they transferred the funds once again to an account with both the client's and Caballero's name on it. After that, they were able to withdraw money for their own personal expenses. The client was not aware of any of the transactions nor did she approve them. Both men also were accused of failing to cooperate with FINRA's investigation after failing to testify and provide relevant information. Although JP Morgan was not a part of the suit, they did refund the elderly woman all of her money back.