Publicly available records provided by the Financial Industry Regulatory Authority (FINRA) on June 9, 2017 indicate that California-based brokerage and advisory firm CUSO Financial Services was recently sanctioned by FINRA in connection to unit investment trust transactions. Fitapelli Kurta is interested in speaking to investors who have complaints regarding CUSO Financial Services (CRD# 42132).
Established in California in 1996, CUSO Financial Services is headquartered in San Diego, California and registered with 53 US states and territories. Amelia Beattie is Chief Operating Officer; Daniel Kilroy is Chief Financial Officer; Valorie Seyfort is Chief Executive Officer; Peter Vonk is Chief Compliance Officer. The firm is registered with the Securities and Exchange Commission and FINRA.
According to the firm’s BrokerCheck report, it was recently sanctioned by FINRA in connection to alleged rule violations.
In January 2017 FINRA sanctioned CUSO Financial Services following allegations it recommended unsuitable unit investment trust transactions. A letter of Acceptance, Waiver and Consent (No. 2013039239102) signed by the firm states further: “During the Relevant Period, CUSO registered representative MH recommended that a number of customers purchase certain UlTs. Each of the prospectuses for these UITs stated that the UIT invested in closed-end bond funds, some of which might employ the use of leverage in their portfolios, and that this leverage might subject the funds to increased risks. Nonetheless, neither MH nor the two CUSO principals who approved the UIT transactions (CD and MG) understood the potential risks of the UITs and, in particular, neither understood that the UITs might employ leverage. CUSO, through MH and principals CD and MG, sold these UITS to 50 CUSO customers, including some seniors, in 76 transactions totaling $4,636,146.” FINRA found that the customers in question “lost approximately $443,000 on the UITs that MH sold without a reasonable basis,” and that some of these customers had previously indicated that they had low risk tolerances. CUSO has since provided restitution totaling $325,000 to a number of these customers.
FINRA additionally concluded that the violations occurred in part because “the Firm’s supervisory system was not reasonably designed to ensure that the Firm’s solicitations and sales of these UITs were suitable for customers” and because “the Firm failed to reasonably enforce its written supervisory procedures regarding suitability reviews and approval ofUIT trades.” CUSO has been censured and issued a fine of $125,000.
If you or someone you know has complaints regarding investments made with CUSO Financial Services, call Fitapelli Kurta at 877-238-4175 for a free consultation. You may be eligible to recoup your losses. Fitapelli Kurta accepts all cases on a contingency basis: we only get paid if and when you collect money. Time to file your claim may be limited, so we encourage you to avoid delay. Call 877-238-4175 now to speak to an attorney for free.