FINRA Award: National Planning Corp. sued for fraudulent promissory notes
According to reports last week, a Financial Industry Regulatory Authority (FINRA) arbitration panel has ordered National Planning Corp. to pay $2.6 million to an elderly St. Louis woman who was sold fraudulent promissory notes.
According to a FINRA award posted last week, the Financial Industry Regulatory Authority (FINRA) ruled in favor of the claimant, an 84-year-old woman, who alleged negligent misrepresentation, common law fraud, breach of contract and negligent supervision. She was reportedly a client of William Glaser, a former registered representative of the company.
Glaser is reportedly serving 3 years in prison for separate charges, after admitting to allegedly misleading and defrauding clients by cashing out money from their retirement portfolios to fund investments with a business associate. He pleaded guilty to three counts of wire fraud on February 26, 2019.
According to the lawsuit, Glaser invested the client’s assets in two allegedly fraudulent promissory notes and recommended other unsuitable investments, including non-traded real estate investment trusts (REITs) and variable annuities, for the sole purpose of generating commissions and fees.
The suit alleges that Glaser further began a pattern of switching in and out of annuities to generate money for himself.
National Planning Corporation reportedly denied the allegations and asserted various defenses. Although the claimant did not seek punitive damages, in addition to $1.58 million in compensatory damages and $45,830 in costs, the arbitration panel awarded her punitive damages of $1 million.
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Last modified: January 13, 2020