The White Law Group reviews the regulatory history of Concorde Investment Services.
Concorde Investment Services, (CRD#: 151604/SEC#: 8-68388) headquartered in Livonia, Michigan, is a full-service broker-dealer and registered investment advisor. Concorde has been a FINRA member since August 2010. According to its FINRA Broker Report, the firm reportedly has 2 disclosure events on its broker record including 2 regulatory events.
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 FINRA and the SEC’s regulatory actions involving Concorde Investment Services.
According to reports this week, FINRA, the regulator who oversees brokerage firms and brokers, has censured and fined Concorde Investment Services in connection with private placement sales. The sanctions reportedly include a $175,000 fine; disgorgement of $58,278 in commissions received, plus interest.
From December 2020 to December 2021, Concorde allegedly sold three private placement offerings claiming exemption from registration under Rule 506(b) of Regulation D, without having established substantive relationships with 45 of the prospective investors prior to the firm’s participation in those offerings. This is a violation of FINRA Rule 2010. During the same period, Concorde’s supervisory system, including its written supervisory procedures (WSPs), allegedly failed to achieve compliance with the Securities Act and FINRA rules related to general solicitation of private placement offerings. Accordingly, the firm violated FINRA Rules 3110 and 2010.
Private placement investments are complex investment products and come with several risks including illiquidity, lack of transparency and high commissions and fees. They are not suitable to all investors due to the risks and complexities.
FINRA Rule 3110 is designed to protect investors by requiring firms to establish and maintain a supervisory system that will achieve compliance with securities laws, regulations, and FINRA rules. This helps to ensure that the firm and its representatives conduct business in an ethical and compliant manner, reducing the risk of harm to investors.
FINRA Censures and Fines Concorde Investment Services
This is not the first time Concorde has been sanctioned for FINRA rules violations. In July 2020, FINRA reportedly sanctioned Concorde with a fine of $300,000; and restitution in the total amount of $76,344.20, plus interest. The firm’s compliance officer was also sanctioned with a four-month suspension, a $10,000 fine and 40 hours of continuing education.
The sanctions stemmed from their alleged failure to reasonably supervise a former registered representative of the Concorde, who permitted her then-husband, to conduct a securities business with Concorde customers while he was serving a one-year suspension imposed by FINRA. From March 2014 to July 2016, Concorde and the compliance officer reportedly failed to reasonably supervise the broker and his alleged recommendations of unsuitable trades in several customers’ accounts, among other things. As a result, the firm and the officer reportedly violated NASD Rule 3010, FINRA Rule 3110 and FINRA Rule 2010.
Broker Misconduct and Customer Complaints – Concorde Investment Services
There have been several cases of registered representatives employed by Concorde Investment Services who were allegedly involved in broker misconduct and fraudulent activities.
In March 2019, former Concorde Investment Services advisor Richard Cody was reportedly sentenced to two years in prison and two years of supervised release after his prison term. Cody, a New Jersey financial advisor was charged with defrauding his retired clients through his company, Boston Investment Partners, LLC.
The SEC’s complaint alleges that Cody defrauded at least three of his retired clients over a twelve-year period by concealing the fact that their retirement accounts had suffered extensive losses. According to FINRA Broker Check, Cody was registered with Concorde Investment Services in Spring Lake, NJ from 03/2014 – 08/2016. He reportedly has 35 disclosures on his broker record. See: Richard G. Cody Securities Fraud Investigation Update
FINRA Arbitration Claims against Concorde Investment Services
The White Law Group filed a FINRA lawsuit against Concorde Investment Services in May 2022, alleging investment losses involving high-risk, non-traded REITs and other alternative investments.
The White Law Group submitted a claim to FINRA Dispute Resolution on behalf of two Oregon retirees, alleging claims for violation of common law fraud, breach of fiduciary duty, negligence, and negligent supervision.
The claim further alleges that Concorde Investment Services unsuitably invested its clients in high-risk alternative investments. The claim is seeking damages of $100,000 to $500,000.
Failure to Supervise
All broker-dealers have a responsibility to adequately supervise its employees. They must ensure the necessary procedures and systems to detect 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.
If your broker has defrauded you, you may be able to file a FINRA claim against your brokerage firm. FINRA arbitration can be a complex and technical process, and having an experienced attorney who is knowledgeable about securities law can greatly increase your chances of success.
Potential Lawsuits to Recover Investment Losses
If you have any questions about investments you made with Concorde Investment Services or if you believe that you have been the victim of securities fraud, The White Law Group may be able to help. To contact the firm, please call 888-637-5510
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm dedicated to helping investors in claims in all 50 states against their financial professional or brokerage firm. Since the firm launched in 2010, it has handled over 700 FINRA arbitration cases.
Our firm represents investors in all types of securities related claims, including claims involving stock fraud, broker misrepresentation, churning, unsuitable investments, selling away, and unauthorized trading, among many others.
With over 30 years of securities law experience, The White Law Group can help you recover your investment losses.
With offices in Seattle, Washington and Chicago, Illinois, the firm reviews securities fraud cases throughout the country. For more information on The White Law Group, please visit https://whitesecuritieslaw.com.
Tags: broker-dealer review, Concorde Investment Services, failure to supervise, finra sanctions Last modified: July 31, 2023