James Merle Culbertson, a former broker at Minneapolis, Minnesota based Ameriprise Financial Services, Inc., submitted a Letter of Acceptance, Waiver and Consent in which he consented to the described sanctions and to the entry of the Financial Industry Regulatory Authority's (FINRA) findings that he had conversations with customers concerning securities transactions he was recommending; and during the course of these conversations, Mr. Culbertson omitted or misrepresented material information to these customers concerning the transactions. The findings stated that Mr. Culbertson circumvented his firm's supervisory review with respect to mutual fund transactions he effected by failing to submit the appropriate documentation or by submitting incomplete or inaccurate documentation to the firm for review. The firm required its registered representatives, including Mr. Culbertson, to complete and submit documentation relating to certain mutual fund transactions. The firm implemented these procedures in order to ensure that it reviewed the proposed transactions for suitability and to ascertain that the registered representative recommended the appropriate share class for purchases.
FINRA's findings also stated that Mr. Culbertson serviced customers' non-discretionary accounts. Mr. Culbertson received orders from these customers but failed to timely enter the orders for transactions in the customers' accounts. Instead, without re-confirming the trades with the customers, Mr. Culbertson entered the orders in their accounts on a discretionary basis. The findings further included that based on Mr. Culbertson's recommendation, a customer agreed to surrender his variable annuity and purchase a fixed annuity with the proceeds of approximately $89,346. These transactions were unsuitable for the customer because the customer could withdraw funds from the variable annuity at any time, the variable annuity had a higher guaranteed fixed rate and death benefit, and the fees associated with the variable annuity were less than those associated with the fixed annuity.
Mr. Culbertson, of Oakdale, Minnesota, was fined $20,000 and suspended from association with any FINRA member in any capacity for 12 months. The fine must be paid either immediately upon Mr. Culbertson's re-association with a FINRA member firm following his suspension, or prior to the filing of any application or request for relief from any statutory disqualification, whichever is earlier. The suspension is in effect from April 15, 2013 through April 14, 2014.
Broker-dealers must establish and implement a reasonable supervisory system to protect customers from broker misconduct. If broker-dealers do not establish and implement a reasonable supervisory system, they may be liable to investors for damages flowing from the misconduct. Therefore, investors who have suffered damages due to Mr. Culbertson's alleged misrepresentations, discretionary transactions, and/or unsuitable recommendations can bring forth claims to recover losses against broker-dealers like Ameriprise Financial Services.
Have you suffered losses in your Ameriprise Financial Services, Inc. account due to misrepresentations, discretionary transactions, and/or unsuitable recommendations by your broker? If so, call Robert Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation. Mr. Pearce is accepting clients with valid claims against Ameriprise Financial Services, Inc. stockbrokers who may have engaged in misconduct and caused investors losses.
The most important of investors' rights is the right to be informed! This Investors' Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over 30 years, Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities and investment law issues. The lawyers at our law firm are devoted to protecting investors' rights throughout the United States and internationally! Please visit our website, www.secatty.com, post a comment, call (800) 732-2889, or email Mr. Pearce at pearce@rwpearce.com for answers to any of your questions about this blog post and/or any related matter.
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