Broker Bar Investigation: Michael Magruder, Tampa, Florida
September 2025 – The Financial Industry Regulatory Authority (FINRA) has barred former broker and investment adviser Michael Edwin Magruder (CRD #4579211) from the securities industry. According to a FINRA Letter of Acceptance, Waiver and Consent (AWC) issued on June 27, 2025, Magruder consented to the sanction without admitting or denying the findings.
FINRA Findings Against Michael Magruder
The bar stems from allegations that Magruder failed to cooperate with FINRA’s investigation into whether he had obtained loans from customers without providing notice to or obtaining approval from his member firms. FINRA had requested account statements and other financial documents material to its investigation.
While Magruder initially provided a partial response, regulators allege that it was incomplete and did not substantially comply with the request. Ultimately, he failed to provide the complete information and documentation, leading to a permanent bar from association with any FINRA member in all capacities.
(FINRA Case #2022075862201)
Customer Disputes and Disclosures
Magruder’s FINRA BrokerCheck report reveals a concerning history of regulatory actions, customer disputes, and settlements:
- August 2025 – Pending customer dispute
- June 2025 – Pending customer dispute
- May 2025 – Customer dispute settled
- July 2024 – Multiple customer disputes settled
- Employment separation after allegations
In total, Magruder has nine disclosures on his record, including regulatory sanctions and customer complaints alleging misconduct.
Employment History
Over his 21-year career, Magruder was registered with several major brokerage firms, including:
- Raymond James & Associates, Inc. – Orlando, FL (2021–2024) and Dallas, TX (2005–2010)
- Merrill Lynch, Pierce, Fenner & Smith Inc. – Destin, FL (2015–2021)
- Wells Fargo Advisors, LLC – Southlake, TX (2010–2015)
- Morgan Keegan & Company, Inc. – 2003–2005
This employment history raises important questions about broker due diligence and supervisory responsibilities at large financial firms that employed Magruder during his career.
Broker Due Diligence and Supervisory Concerns
FINRA requires brokerage firms to establish and maintain supervisory systems to prevent broker misconduct. Firms must monitor for red flags such as undisclosed loans with customers, unsuitable investment recommendations, or other potential conflicts of interest.
When firms fail in their supervisory duties, investors may suffer losses. Under FINRA rules, brokerage firms can be held liable for failing to supervise their registered representatives, leaving them responsible for compensating investors in some cases.
Recovering Investment Losses in FINRA Arbitration
Investors who suffered financial losses with Michael Magruder may be able to pursue claims through FINRA arbitration, the primary forum for resolving disputes between brokers, firms, and customers. Claims may involve allegations such as:
- Failure to disclose conflicts of interest
- Selling away or unauthorized transactions
- Unsuitable investment recommendations
- Breach of fiduciary duty
- Negligent supervision by the firm
FINRA arbitration is generally faster and more efficient than traditional litigation and may allow investors to recover damages directly from the broker-dealer firm.
The White Law Group: Nationwide FINRA Arbitration Attorneys
The White Law Group represents investors in claims against brokers and brokerage firms nationwide, such as Raymond James, Merrill Lynch, and Wells Fargo. If you invested with Michael Magruder and suffered financial losses, you may have a claim for recovery.
For a free consultation with a securities fraud attorney, please call The White Law Group at (888) 637-5510.
Frequently Asked Questions (FAQs)
1. Why was Michael Edwin Magruder barred by FINRA?
FINRA barred Magruder after he failed to provide requested documents and information in connection with an investigation into whether he obtained loans from customers without firm approval.
2. Can investors recover losses from broker misconduct?
Yes. Investors may be able to recover losses by filing claims against the broker’s firm through FINRA arbitration, which holds brokerage firms responsible for failing to supervise their financial advisors.
3. What should I do if I invested with Michael Magruder?
If you suffered losses with Magruder, you should consult with a securities attorney to evaluate potential claims and explore your recovery options.
