The White Law Group reviews the regulatory history of LaSalle St. Securities, LLC.
LaSalle St. Securities LLC, based in Elmhurst, Illinois, has twenty disclosures on their broker profile, according to FINRA, the self-regulator that oversees brokers and brokerage firms. According to reports, the firm had revenue of $44 million in 2020. The firm is dual registered as a brokerage firm and an investment advisory firm, CRD#: 7191/SEC#: 8-18860.
According to the firm’s FINRA BrokerCheck summary, the firm has 15 regulatory actions, four arbitrations and 1 bond.
LaSalle St. Securities Broker Misconduct
There have been several cases of registered representatives employed by LaSalle St. Securities who were allegedly involved in broker misconduct and fraudulent activities.
In 2022, FINRA charged a LaSalle St. broker in Frankfort, Illinois with forging a customer’s signature. The broker was suspended and fined $5,000.
In 2016, FINRA barred a LaSalle St. Securities broker in Palatine, Illinois after he failed to provide information in an investigation into his alleged undisclosed outside business activities.
In 2013, FINRA charged a LaSalle St. Securities broker in Buffalo Grove, Illinois with effecting trades in a deceased customers account without authorization or consent by the customer or her representatives. FINRA alleges that the customer actually died two years before the broker began representing the accounts.
FINRA Sanctions LaSalle St. Securities
FINRA takes regulatory actions to ensure that member firms and individuals adhere to ethical and legal standards in the securities industry, and to protect investors from fraud and other misconduct. LaSalle St. Securities has at least 15 regulatory actions on their broker report or CRD.
Regulatory actions can include but are not limited to fines, suspensions, expulsions, cease and desist orders or restitution.
FINRA censured and fined LaSalle St. Securities $175,000 in 2014, over allegations that the firm failed to due diligence in connection with private placement offerings and failed to supervise consolidated reports.
FINRA found that LaSalle allegedly distributed a private placement memorandum to potential investors that did not include material facts and used a flawed methodology for projecting return on investment involving a private offering, Revitalight Operators LLC.
The firms also allegedly failed to due diligence on another private placement offering involving Seat Exchange Corporation and allowed a broker to recommend the offering to four investors. The firm also failed to supervise one of its brokers in connection with an offering of Platinum Wealth Partners, Inc. Further, LaSalle St. Securities purportedly allowed its representatives to send consolidated reports to its customers but failed to adequately supervise those reports.
A consolidated report is a single document that combines information regarding most or all of a customer’s financial holdings, regardless of where those assets are held. Consolidated reports supplement, but do not replace official customer account statements required by FINRA rules and disseminated through a separate process.
Consolidated reports must be clear, accurate and not misleading, and if not “rigorously” supervised, they can raise several regulatory concerns, including the potential for communicating inaccurate, confusing or misleading information to customers, lapses in supervisory controls, and the use of these reports for fraudulent or unethical purposes, according to the self-regulator.
SEC orders LaSalle St. Securities To Cease and Desist
In 2012, the Securities and Exchange Commission filed charges against Tilden Loucks & Woodnorth, LLC, an investment adviser along with LaSalle St. Securities.
Tilden Loucks & Woodnorth received undisclosed compensation by charging increased commissions on trades for its clients through its affiliated broker-dealer, LaSalle, according to the SEC’s order. The SEC’s Order further finds that Tilden Loucks & Woodnorth failed to seek best execution for its clients’ securities transactions and made misleading statements in its Forms ADV concerning the steps it would take to evaluate execution of client trades and ensure that commission rates were reasonable.
Tilden Loucks & Woodnorth’s clients paid commissions at LaSalle that averaged more than $143 per trade (even though the majority of trades apparently consisted of buys and sells of large cap equities). Tilden Loucks & Woodnorth allegedly did not tell its clients the true nature of the commissions it charged by stating in its Forms ADV that clients obtained a significant “discount” to LaSalle’s scheduled retail brokerage charges.
However, it appears that LaSalle had no scheduled retail brokerage charges or commission schedules. Tilden Loucks & Woodnorth’s clients didn’t know it at the time but the firm set the commission charges at rates exceeding LaSalle’s charge to Tilden Loucks & Woodnorth to execute a trade and the “discount” was in reality only a price lower than those reflected on a commission schedule supplied by Tilden Loucks & Woodnorth that dated to at least 1988. According to the SEC’s Order, Tilden Loucks & Woodnorth’s undisclosed compensation practices netted it more than $186,000 in higher commissions paid by advisory clients.
Tilden Loucks & Woodnorth and LaSalle agree to cease and desist from any future violations of these provisions. Further, Tilden Loucks & Woodnorth and LaSalle agree to jointly and severally disgorge $170,319.94 in ill-gotten gains and to pay prejudgment interest of $16,531.06.
FINRA Rule 3110 Supervision
FINRA Rule 3110 aims to promote investor protection by ensuring that broker-dealers establish and maintain adequate supervisory systems and procedures to detect and prevent violations of securities laws and regulations.
The rule requires broker-dealers to establish written supervisory procedures and to designate one or more principals to be responsible for supervising the firm’s operations and ensuring compliance with the applicable rules.
The rule also requires broker-dealers to conduct periodic reviews of their supervisory systems, including the supervisory procedures and the activities of their associated persons, to ensure that the systems are reasonably designed to achieve compliance with the applicable rules.
Furthermore, FINRA Rule 3110 requires broker-dealers to establish a system for the review of incoming and outgoing correspondence with the public relating to the broker-dealer’s business. The review must be conducted by a designated principal and must be designed to ensure that the correspondence complies with applicable securities laws and regulations.
Finally, the rule requires broker-dealers to establish and maintain a system for the preservation of books and records, including electronic communications, in accordance with applicable securities laws and regulations. The system must be designed to ensure that the books and records are maintained in a manner that allows for their prompt and accurate retrieval.
FINRA Arbitration for Investment Losses
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 claim with FINRA to seek resolution through arbitration.
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.
A securities attorney, such as those at the White Law Group, can help you with many aspects of the arbitration process including evaluating the merits of your claim and determine whether you have a strong case for arbitration.
Your attorney can assist you in drafting a statement of claim that accurately reflects the allegations of fraud and the damages you are seeking. They will also represent you at the arbitration hearing, present evidence and make arguments on your behalf. They can also negotiate a settlement on your behalf, which may be an option to consider before going to arbitration.
Working with a securities attorney can help ensure that your interests are protected throughout the FINRA arbitration process, and that you have the best possible chance of achieving a favorable outcome. Keep in mind, FINRA arbitration is generally a faster and less expensive alternative to a traditional court proceeding.
National FINRA Arbitration Attorneys – the White Law Group
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 40 years of securities law experience, including experience working at FINRA and the SEC, The White Law Group has the expertise to help investors defrauded in securities, investment and financial business transactions attempt to recover their investment losses.
Although our offices are in Seattle, Washington and Chicago, Illinois, the firm reviews securities fraud cases throughout the country.
If you have concerns regarding investments you purchased through LaSalle St. Securities and would like to speak with a securities attorney, please call The White Law Group at 888-637-5510.
For more information on The White Law Group, visit whitesecuritieslaw.com.
Tags: LaSalle St. Securities claims, Lasalle St. Securities complaint, LaSalle St. Securities disciplinary action, LaSalle St. Securities fine, LaSalle St. Securities FINRA, LaSalle St. Securities investigation, Lasalle St. Securities lawsuit, Lasalle St. Securities review, LaSalle St. Securities sanction, LaSalle St. Securities settlement, SEC cease and desist Last modified: April 14, 2023