Securities Lawyers Blog
According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker Craig Friedrichsen (Friedrichsen), currently associated with LPL Enterprise, LLC, has at least 4 disclosable events. These events include 4 customer complaints, alleging that Friedrichsen recommended unsuitable investments in different investment products including debt securities among other allegations and complaints.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $41,500.00 on November 22, 2023.
Claimant alleges that, in September of 2015, the representative failed to disclose the illiquid nature and risks associated with a non-traded real estate investment trust. Claimant further alleges that the recommendation was unsuitable.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $50,000.00 on January 19, 2023.
Claimant(s) allege that representative recommended investments that were largely concentrated in illiquid, speculative, low-quality, and high commission non-traded real estate investment trusts and Business Development Companies.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $100,001.00 on November 22, 2021.
Claimants allege in 2015 they were sold alternative investments which were misleadingly represented as low risk, safe and suitable investments.
FINRA BrokerCheck shows a settled customer complaint on January 28, 2009.
CLIENT ALLEGES THAT 72T PAYMENTS WERE SET UP BY HER REGISTERED REPRESENTATIVE IN A MANNER DESIGNED TO AVOID ADVERSELY IMPACTING HER LIFETIME WITHDRAWAL GUARANTEE AMOUNT, AND THE 72T CALCULATION WAS SUBMITTED BY THE REGISTERED REPRESENTATIVE TO METLIFE FOR REVIEW; HOWEVER, METLIFE WOULD NOT AFFIRM OR DENY THE ACCURACY OF THE PROPOSED 72T AMOUNTS, AND THE 72T PAYMENTS RESULTED IN A REDUCTION OF CLIENT’S LIFETIME WITHDRAWAL GUARANTEE AMOUNT.
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. Finally, the advisor must use their knowledge of the first two elements to consider reasonably available investment option alternatives and come to the conclusion that there is a reasonable basis to believe that the recommendation or advice being provided is in the retail investor’s best interest.
In addition to specific investments being recommended, under Reg BI, a broker must also understand the type of account that their client would need in order to meet their care obligations. The SEC has stated that the type of securities account an investor has can greatly affect a customers’ costs and overall investment returns. Further, different account types can offer and support different features, products, securities, or services, and account type would not be appropriately applied in a one size fits all manner.
Friedrichsen entered the securities industry in 1996. Friedrichsen has been registered as a Broker with LPL Enterprise, LLC since 2024.
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.