KCD Financial Regulatory History & Investor Complaints
The White Law Group is investigating potential securities claims involving KCD Financial, Inc. (CRD#: 127473), a Wisconsin-based broker-dealer with a history of regulatory sanctions and supervisory failures. Over the years, KCD has faced multiple FINRA and SEC disciplinary actions tied to the sale of unregistered securities and inadequate branch oversight. These issues raise serious concerns for investors who may have suffered losses due to unsuitable investment recommendations and weak compliance practices at the firm.
FINRA Sanctions Against KCD Financial
- May 30, 2017 – SEC Final Decision: The firm was censured and fined $73,000 for selling at least $2 million in unregistered securities and failing to properly supervise its representatives. The SEC sustained findings from FINRA’s National Adjudicatory Council (NAC) that KCD allowed sales despite warnings that the issuer engaged in prohibited general solicitation.
- July 19, 2018 – FINRA Sanction: FINRA censured and fined KCD Financial $10,000 for supervisory failures. The firm failed to timely inspect its registered and non-registered branch offices as required by FINRA rules and its own Written Supervisory Procedures. Although its WSPs required inspections at least once every three years, KCD failed to conduct those inspections.
Broker Misconduct – Roy Williams (KCD Financial)
According to FINRA BrokerCheck, Roy Williams, a registered broker and investment adviser with KCD Financial, has been in the securities industry for over 40 years and has 10 disclosures on his record. These include multiple customer disputes, both settled and pending, as well as a prior FINRA suspension and fine for using an undisclosed outside email to avoid compliance oversight.
- Unsuitable Recommendations: Clients claim Williams recommended high-risk, illiquid products such as L Bonds and non-traded REITs that were not aligned with their investment profiles.
- Negligence & Misrepresentation: Allegations include failure to adequately disclose risks and misleading clients regarding investment safety.
- Supervisory Failures: Use of unauthorized communication channels to circumvent compliance monitoring.
Risks for Investors
Products such as L Bonds, private placements, and non-traded REITs are often high-risk and illiquid. They typically carry high commissions for brokers, limited transparency for investors, and a risk of significant losses. For retirees or conservative investors, these investments may be wholly unsuitable.
Recovery Options for Investors
If you invested with KCD Financial or Roy Williams and suffered losses, you may be able to pursue claims for recovery. Brokerage firms have a duty to supervise their brokers and ensure investment recommendations are suitable. When they fail in these obligations, both the firm and the individual broker may be liable for damages.
These claims are often pursued through FINRA arbitration, a forum that is typically faster and more cost-effective than class action litigation.
Free Consultation with Securities Attorneys
If you have concerns about your investments with Roy Williams or KCD Financial, The White Law Group may be able to help. We represent investors nationwide in claims against brokerage firms for misconduct and investment losses.
Call The White Law Group at (888) 637-5510 for a free consultation. For more information, please visit www.whitesecuritieslaw.com.
FAQs
Why was KCD Financial sanctioned by FINRA?
KCD Financial was sanctioned for supervisory failures, including selling unregistered securities and failing to inspect its branch offices as required under FINRA rules.
Are private placements recommended by KCD Financial risky?
Yes. Private placements are generally illiquid, speculative, and often unsuitable for conservative investors seeking income or stability.
What steps can investors take if they suffered losses?
Investors may pursue recovery through FINRA arbitration, which allows claims against the firm for unsuitable recommendations or inadequate supervision.
