Jack McBride, a financial broker currently registered at Wunderlich Securities
Inc., was under investigation by FINRA over allegations of soliciting
prohibited securities up until the FINRA claims were settled this October.
McBride (CRD# 2517946) has been with Wunderlich for the past three years.
Before that, he was registered with Ameriprise for four years.
According to FINRA, McBride committed several violations concerning customer
accounts while at Ameriprise, including settling a customer complaint
without notifying his firm, sending emails with inflated account values,
and marking non-traditional Exchange Traded Products (non-traditional
ETFs) order tickets as unsolicited, when they should have been marked
FINRA stated that,
“It is a violation of FINRA Rule 2010 for a registered representative
to settle a customer complaint without his firm's knowledge or approval.
The Firm's policies similarly prohibited representatives from engaging
in settlements and refunding clients without the Firm's knowledge.”
In September, Jack McBride agreed to accept and consent to the allegations
of the FINRA investigation along with fines and a suspension.
Two previously filed customer arbitrations relating to McBride’s
misconduct have been settled. Both of those complaints concerned the sale of ETFs.
Risks of Exchange Traded Funds (ETFs)
ETFs are mutual funds that are traded in the same manner as traditional
stocks. They are often marketed as simple for the common investor to understand,
but have come under scrutiny for being incredibly complex in practice
and may expose investors to additional undisclosed risk.
The descriptions of ETFs are often vague and generic. Further, some ETFs
can carry confusing fee structures, allowing unscrupulous brokers to line
FINRA has recently levied fines against major brokerages, including Citigroup
Inc., Morgan Stanley, and Wells Fargo over the sale of inverse and leveraged
ETFs. These products started as offerings for institutional investors,
but have been offered to individuals. The regulatory agencies have started
to crack down on this practice because of the complexity of inverse and
leveraged ETFs and the additional risk.
If you have invested in ETFs on the recommendation of your broker and lost
contacting the experienced investment attorneys at Meyer Wilson to determine whether your broker made an unsuitable recommendation.