Thomas Rapp — Suspended after Allegations of Private Securities Transactions
On April 8, 2025, FINRA, the regulator that oversees brokers and brokerage firms, reportedly suspended financial advisor Thomas Rapp for 21 months for allegedly engaging in undisclosed outside business activities.
Rapp allegedly co-founded and led a private equity fund without notifying his firm, and reportedly participated in raising over $11 million through a private securities offering, and interacted with investors—some of whom were also his clients. He reportedly did not receive commissions from the offering.
Private Securities Transactions
FINRA Rule 3280 requires associated persons to provide written notice to their firm before participating in any private securities transaction. The notice must include details of the transaction, the individual’s role, and whether they expect to receive compensation. Private securities transactions are defined as those conducted outside the scope of the person’s employment with the firm. Violating Rule 3280 also constitutes a violation of FINRA Rule 2010.
FINRA BrokerCheck: Thomas Rapp
The FINRA BrokerCheck tool is a free online tool that allows investors to research and verify the background and credentials of financial brokers, brokerage firms, and investment advisors registered with FINRA.
Thomas Rapp was reportedly registered with M Holdings Securities (CRD#:43285) in Morristown, NJ from 08/20/2014 – 07/19/2023.
Failure to Supervise
FINRA Rule 3280 is designed to protect investors and maintain transparency and oversight in the securities industry. By requiring disclosure of outside transactions, firms can evaluate whether a broker’s involvement could conflict with their duties to clients or the firm, preventing conflicts of interest. Private securities offerings can be risky. When brokers operate outside firm supervision, clients may unknowingly invest in ventures lacking proper oversight or due diligence.
FINRA-registered broker-dealers have a duty to supervise their brokers. If the firm fails to supervise its brokers properly, and the investors lose money, the firm can be held liable through FINRA arbitration.
Class Action Lawsuit vs. Individual FINRA Arbitration Lawsuit
You may wonder whether a large class action lawsuit is a better litigation option than an individual FINRA arbitration case. The answer depends on many factors, but typically if the loss sustained is large (say larger than $100,000), an individual arbitration claim is likely a better option. Class action lawsuits as a recovery option are more appropriate for grouping large numbers of individuals who have small claims – too small to generally pursue individually.
FINRA Lawsuits
If you have suffered investment losses with Thomas Rapp and M Holdings Securities, the securities attorneys at the White Law Group may be able to help you by filing a FINRA lawsuit. Please call our offices at (888) 637-5510 for a free consultation. We take cases in all 50 states including New Jersey.
National Securities Attorneys
The White Law Group, LLC is a national law firm in securities fraud, securities arbitration, investor protection, and securities regulation and compliance. With offices in Chicago, Illinois and Seattle, Washington, the firm is dedicated to assisting investors across all 50 states with claims against their brokerage firms. Since its founding in 2010, The White Law Group has handled over 800 FINRA arbitration cases.
Last modified: April 11, 2025
