The White Law Group reviews the regulatory history of Ausdal Financial Partners.
Ausdal Financial Partners (CRD#: 7995/SEC#: 801-69266,8-24519) has been a FINRA broker-dealer since January 7, 1980. Ausdal, located in Davenport, Iowa, has two disclosures on its CRD or FINRA BrokerCheck report, one regulatory event and one arbitration. Regulatory actions taken against a broker-dealer may include censures, fines, suspensions and restitution, among others. They can have serious consequences for a broker-dealer’s profile and reputation. The following is a review of Ausdal Financial Partners including complaints, broker misconduct and FINRA claims.
Customer Complaints and Broker Misconduct
All broker-dealers have a responsibility to adequately supervise its employees. They must ensure the necessary procedures and systems to detect misconduct. There have been several cases of registered representatives employed by Ausdal Financial Partners who were allegedly involved in broker misconduct and fraudulent activities. When brokers violate securities laws, such as making unsuitable investments, the brokerage firm they are working with may be liable for investment losses through FINRA Arbitration.
July 2023 – FINRA, the regulator who oversees brokers and brokerage firms, reportedly barred former Ausdal broker David Geake from working in the securities industry after allegations of selling away. Geake allegedly raised funds through the sale of common stock for a startup company developing technology to sell automotive parts online. In November 2016, after registering with Ausdal Financial Partners, Geake allegedly solicited an elderly husband and wife to pledge approximately $1.5 million of securities as collateral to guarantee a $2.5 million loan from a bank on behalf of the company, and assured the couple that their risk of investment loss was minimal. In 2018, the bank called for the loan to be paid in full. As a result, the couple were required to repay the entire $2.5 million bank loan with interest. Geake reportedly has 25 customer complaints on his record. Allegations include unsuitable recommendation, overconcentration, misrepresentations and omissions, among others.
In 2019, the SEC reportedly charged Former Ausdal Financial Partners financial advisor Richard “Guy” Duncan with fraud in connection with selling over $300,000 in a purported bad Turkish investment . The regulator reportedly charged Duncan with fraud, claiming two banks warned the advisor that the Turkish investment was probably a scam. He allegedly ignored the warnings, failing to disclose the risks to clients, while purportedly promising 100% return on investment on the product, according to the SEC. Duncan reportedly has two customer complaints filed against him. In June 2022, the SEC reportedly found that Duncan breached his fiduciary duty to his clients by (a) failing to disclose material facts, including his conflict of interest in the Turkish investment and (b) concealing unambiguous scam warnings from two banks regarding the investment. Further Duncan allegedly failed to investigate the legitimacy of the Turkish investment and failed to provide investment advice in his clients’ best interest.
July 2017 – an Ausdal broker based in Schaumburg, IL was suspended for 4 months and fined for allegations that he willfully failed to disclose that he was the subject of an investment-related, consumer-initiated written complaint for sales practice violations. Allegations included fraud, fraud in violation of the Federal Securities Law, fraud in violation of the Illinois Securities Law, breach of fiduciary duty, “unsuitability,” and civil conspiracy, all relating to clients’ investment in a business. The broker also allegedly tried to settle the claims without notifying his member firm, against FINRA rules.
FINRA Claims: Ausdal Financial Partners Lawsuits
The White Law Group has previously represented investors in claims against Ausdal Financial Partners.
In July 2022, our firm filed a FINRA arbitration claim against Ausdal Financial on behalf of four Illinois families, alleging claims for violation of common law fraud, breach of fiduciary duty, negligence, and negligent supervision.
The claim alleges that Ausdal Financial Partners Inc. unsuitably invested its clients in the high-risk GWG Series L Bond, securities sponsored by GWG Holdings, a Dallas-based financial services firm. GWG Holdings, Inc filed for Chapter 11 bankruptcy protection on April 20, 2022 after failing to make $13.6 million in interest payments to bondholders in January of last year. Ausdal Financial Partners allegedly failed to perform the necessary due diligence on these investments prior to recommending them to these investors.
FINRA Censures and Fine Ausdal Financial Partners
December 2012 – FINRA censured and fined Ausdal for its failure to retain some email correspondence related to its business as a broker-dealer from October 2008 through June 2011, in violation.
All broker-dealers have a responsibility to adequately supervise their advisors. They must ensure they have procedures and systems in place to detect broker misconduct. Brokerage firms that fail to monitor the business activities of their employees may be liable for investment losses due to negligent supervision for the misconduct of their employees.
When brokers violate securities laws, such as making unsuitable investments, the brokerage firm they are working with may be liable for investment losses through FINRA Arbitration.
The Financial Industry Regulatory Authority (FINRA) operates the largest dispute resolution forum in the securities industry. In fact, FINRA Dispute Resolution is the forum for almost all disputes between investors, brokerage firms and individual brokers. This is mainly because the vast majority of brokerage firms have mandatory arbitration clauses in their account agreements that require investors to file their disputes through FINRA.
The White Law Group represents investors in FINRA claims against their broker dealers. If you have suffered losses due to broker negligence or broker fraud, we can help. Our firm can evaluate the strength of your case, draft a well-structured statement of claim that accurately presents your allegations of fraud and desired damages, and provide representation during the arbitration hearing by presenting evidence and making compelling arguments on your behalf. Additionally, an attorney can engage in negotiation efforts for a potential settlement before the arbitration process begins. Opting for our securities attorneys will ensure that your rights are safeguarded throughout the arbitration process, maximizing your likelihood of achieving a favorable resolution.
If you have suffered losses with Ausdal Financial Partners, the securities attorneys at the White Law Group may be able to help you. For a free consultation, please call the offices at 888-637-5510.
The foregoing information, which is all publicly available, is being provided by The White Law Group. The White Law Group is a national securities arbitration, securities fraud, and investor protection law firm with offices in Chicago, Illinois and Seattle, Washington.
For more information on The White Law Group, visit whitesecuritieslaw.com.
Tags: Ausdal Financial Partners, broker-dealer review, finra sanctions Last modified: August 25, 2023