(888) 637-5510

Written by 8:18 pm Blog, Current Investigations

The Investment Center Inc. Overview

The Investment Center Inc. Review - Broker Fraud, Customer Complaints and Regulatory Actions, featured by top securities fraud attorneys, The White Law Group

The White Law Group is investigating potential securities claims involving The Investment Center Inc. 

The Investment Center Inc., based in Bedminster, New Jersey, has 13 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 $64 million in 2020.  The firm is dual registered as a brokerage firm and an investment advisory firm, CRD#: 17839/SEC#: 8-35826.  

According to the firm’s FINRA BrokerCheck profile, the The Investment Center has 8 regulatory actions and five arbitrations.  Regulatory actions taken against a broker-dealer can have serious consequences on their profile and reputation. They may include censures, fines, suspensions or restitution among others. 

Arbitrations on a broker-dealer’s CRD (Central Registration Depository) refer to the resolution of disputes between a broker-dealer and a client or between broker-dealers themselves through the FINRA arbitration process. When a client or another broker-dealer files a complaint against a broker-dealer, the complaint may be resolved through arbitration, which is a process where an independent third party (the arbitrator) hears both sides of the dispute and makes a binding decision. 

Texas Securities Board Charges the Investment Center Inc. with Failure to Supervise 

August 2016 – The Texas State Securities Board ordered The Investment Center, Inc. a securities dealer located in Bedminster, New Jersey and registered in Texas to pay $50,000 for allegedly failing to supervise a broker who overloaded clients’ accounts with energy stocks. 

According to the consent order, between January 2010 and March 2014 the representative recommended that certain clients purchase securities that raised red flags related to the suitability of the Agent’s recommendations for those clients based on their investment profiles. 

In addition, certain clients at the firm held 95% of their total investible assets in equities in the energy sector, at the agent’s recommendation, the order alleges. In some instances, all of those shares were in one company, despite the clients’ low tolerance for risk, according to the document. 

Despite the red flags raised by the unidentified agent’s sales activity, The Investment Center, Inc. allegedly failed to reasonably supervise this activity. 

In another example, the New Jersey Bureau of Securities in 2010 reportedly assessed a $75,000 civil penalty against The Investment Center Inc. for failure to reasonably supervise its agents and for failure to maintain required books and records. 

The Investment Center Inc., allegedly failed to supervise the former manager of its Marlton branch office; and an agent in the office, who were also undisclosed principals of North Shore Investment Group, LLC. Ten investors sustained losses after investing a combined $1.6 million in North Shore through the two agents. Those investors included five clients of the Marlton branch office of Investment Center Inc., who invested in North Shore without knowing that the agents were principals. 

The Investment Center Inc. Broker Misconduct  

There have been several cases of registered representatives employed by The Investment Center Inc. who were allegedly involved in broker misconduct and fraudulent activities.  

The Investment Center advisor Leon Vaccarelli, of Waterbury CT, was indicted and later convicted on 12 counts of fraud and money laundering related to an investment scheme that prosecutors say defrauded investors of more than $1 million. 

Vaccarelli allegedly deposited customers’ money through his financial advisory and brokerage service, Lux Financial Services, into his own personal account and business bank accounts, instead of investing the funds, as promised. The scheme reportedly took place between 2011 and 2017. 

He was accused of using the money to pay business and personal expenses, including tuition and mortgage payments. 

According to his FINRA BrokerCheck report, Vaccarelli was registered with The Investment Center in Waterbury, CT from February 2011 until August 2017. He has 15 disclosure events listed on his broker report, including 10 customer complaints. Vaccarelli is not currently registered as a broker. 

In another case, FINRA reportedly barred Investment Center broker Richard Holliday (CRD #2356026, Belton, South Carolina) in 2014 after allegations that over a period of three years, he borrowed $155,000 from customers without disclosing the loans to his member firms. 

FINRA Rule 3110 Supervision   

The FINRA supervision rule (FINRA Rule 3110) is important for investors because it helps to ensure that broker-dealers are effectively monitoring and supervising their employees’ activities and complying with all rules and regulations.  

The FINRA supervision rule requires broker-dealers to have effective supervisory procedures in place to prevent and detect misconduct by their employees. This helps to protect investors from fraudulent or unethical behavior. 

Further, FINRA requires broker-dealers to supervise the investment recommendations made by their employees to ensure that investors are receiving suitable investment advice that is appropriate for their financial situation and investment objectives. 

FINRA Rule 3110 also holds broker-dealers accountable for the actions of their employees. If a broker-dealer fails to adequately supervise its employees and a customer is harmed as a result, the broker-dealer may be held liable. 

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 The Investment Center 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: , , , , , , , , Last modified: May 16, 2023