FINRA Claim Alleges Unsuitable Investment Recommendations
The White Law Group announced this week that it has filed a FINRA Statement of Claim requesting damages for alleged violation of common law fraud, breach of fiduciary duty, negligence, and negligent supervision against Kovack Securities.
The Statement of Claim alleges the broker of record made unsuitable investment recommendations by soliciting the purchase of two high risk penny stocks, Marathon Patent Group, Inc. and TrovaGene, Inc. The claim seeks damages between $100,000.01 and $500,000.
According to the statement of claim, Kovack Securities allegedly failed to perform the necessary due diligence on these investments prior to recommending them to these particular investors.
Before recommending an investment, a broker-dealer has a fiduciary duty to adequately disclose the risks involved in the investment and to perform the necessary due diligence to determine whether the investment is suitable for the investor.
According to D. Daxton White, managing partner of The White Law Group, ” It is unfortunate, but we believe that many more investors have suffered devastating losses due to the broker-dealer’s alleged failure to supervise and don’t realize they have recovery options.”
“Brokerage firms are required to supervise their advisors to ensure that they are complying with FINRA rules. If it can be determined that the broker violated FINRA rules and the employers failed to adequately supervise him, these firms can be held responsible for any resulting losses in a FINRA arbitration claim.”
FINRA Arbitration Attorneys
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Seattle, Washington. The firm has handled more than 600 FINRA arbitration claims alleging claims for unsuitable investment recommendations, conversion, breach of fiduciary duty, selling away, fraud and other issues.
For more information The White Law Group and the claim filed against Kovack Securities, please contact the offices at 1-888-637-5510 or visit https://www.whitesecuritieslaw.com.
Tags: Kovack Securities, Marathon Patent Group, TrovaGene Last modified: August 18, 2023