O.N. Equity Sales Company: Complaints and Regulatory Action Review

O.N. Equity Sales Company Complaints, Regulatory Actions, and FINRA Arbitration

The White Law Group reviews the regulatory history of O.N. Equity Sales Company, including customer complaints, FINRA sanctions, and arbitration claims. O.N. Equity Sales Company (CRD# 2936 / SEC# 8-14161) is a dual-registered broker-dealer and investment adviser headquartered in Cincinnati, Ohio. According to FINRA BrokerCheck, the firm has multiple disclosures, including regulatory actions and investor arbitrations, which may be relevant to investors evaluating the firm’s supervision, sales practices, and compliance history.

O.N. Equity Sales Company Disclosures and FINRA BrokerCheck Overview

Publicly available FINRA BrokerCheck records indicate that O.N. Equity Sales Company has nine reportable disclosure events, including seven regulatory matters and two arbitrations. Disclosures on a firm’s CRD can provide insight into patterns of customer complaints, supervisory failures, or compliance issues that may expose investors to unnecessary risk.

What Do Arbitrations on a Broker-Dealer’s CRD Mean?

Arbitrations listed on a broker-dealer’s CRD reflect disputes filed by customers seeking to recover investment losses. While not every arbitration establishes wrongdoing, a pattern of arbitration claims may raise concerns about sales practices, suitability, or supervision at a brokerage firm.

FINRA Regulatory Actions Against O.N. Equity Sales Company

FINRA Sanctions for Unsuitable Variable Annuity Sales

In May 2021, the Financial Industry Regulatory Authority (FINRA) censured and fined O.N. Equity Sales Company $275,000 and ordered the firm to pay more than $1 million in restitution to customers. FINRA found that from March 2014 through September 2017, the firm failed to establish and maintain a supervisory system reasonably designed to ensure suitable variable annuity recommendations.

According to FINRA, a representative allegedly recommended an unsuitable strategy involving the liquidation of retirement assets to purchase variable annuities, followed by early withdrawals to fund whole life insurance policies—resulting in unnecessary costs and potential harm to investors.

SEC Enforcement Action Involving O.N. Investment Management

Conflicts of Interest and 12b-1 Fee Disclosures

In January 2022, the Securities and Exchange Commission (SEC) sanctioned O.N. Investment Management Company, an affiliated registered investment adviser, for breaching its fiduciary duties to advisory clients. The SEC alleged the firm steered clients into higher-cost mutual fund share classes that paid 12b-1 fees, despite the availability of lower-cost alternatives.

O.N. Equity Sales Company acted as the introducing broker-dealer for advisory clients and reportedly received 12b-1 fees that would not have been earned had lower-cost shares been used. The SEC alleged these conflicts of interest were not adequately disclosed, violating fiduciary obligations.

O.N. Equity Sales Company Customer Complaints and Broker Misconduct

Broker-dealers are required to supervise their registered representatives and maintain systems designed to detect and prevent misconduct. Firms that fail to do so may face liability for negligent supervision in FINRA arbitration.

Reported disciplinary matters involving O.N. Equity Sales Company representatives include:

• August 2020: FINRA barred a New Jersey-based broker for participating in undisclosed private securities transactions.

• April 2020: FINRA suspended and fined a Colorado-based representative for engaging in unapproved outside business activities in violation of FINRA Rules 3270 and 2010.

• May 2019: Kansas regulators barred broker Lawrence Hagedorn, ordered restitution, and imposed fines after allegations he borrowed money from customers and misused the funds. Hagedorn later pleaded guilty to felony securities violations.

Using FINRA BrokerCheck to Research O.N. Equity Sales Company

FINRA BrokerCheck is a free tool that allows investors to review disciplinary history, customer complaints, and registration details for brokerage firms and financial advisors. Reviewing BrokerCheck disclosures can help investors make informed decisions and identify potential red flags before investing.

FINRA Arbitration and Recovery of Investment Losses

When brokers recommend unsuitable investments, fail to disclose conflicts, or engage in misconduct, investors may be able to pursue recovery through FINRA arbitration. Arbitration is typically faster and less expensive than court litigation and allows investors to seek damages directly from brokers and brokerage firms.

FAQs About O.N. Equity Sales Company

1. Does O.N. Equity Sales Company have customer complaints or lawsuits?

Public FINRA BrokerCheck records show that O.N. Equity Sales Company has customer arbitrations and regulatory disclosures. While not every complaint proves wrongdoing, multiple disclosures may warrant closer review by investors.

2. What was FINRA’s action against O.N. Equity Sales Company?

FINRA fined O.N. Equity Sales Company $275,000 and ordered over $1 million in restitution for failures to supervise variable annuity sales that were found to be unsuitable for certain customers.

3. Can investors recover losses through FINRA arbitration?

Yes. Investors who suffered losses due to unsuitable recommendations, conflicts of interest, or lack of supervision may be able to pursue compensation through FINRA arbitration, depending on the facts of their case.

National FINRA Securities Attorneys – The White Law Group

The White Law Group is a national securities fraud and FINRA arbitration law firm representing investors in all 50 states. Since 2010, the firm has handled hundreds of FINRA arbitration cases involving unsuitable investments, misrepresentation, selling away, and failure to supervise.

If you have concerns about investments made through O.N. Equity Sales Company, call The White Law Group at 888-637-5510 or visit www.whitesecuritieslaw.com for a confidential consultation.