Publicly available records provided by the Financial Industry Regulatory Authority (FINRA) on November 28, 2016 indicate that Massachusetts-based broker-dealer firm Investors Capital Corporation has submitted a letter of Acceptance, Waiver and Consent to settle allegations of misconduct related to unit investment trusts (UITs). The securities and investment fraud law firm Fitapelli Kurta is interested in hearing from investors who have complaints regarding Investors Capital Corporation (CRD# 30613).
Formed in Massachusetts in 1992, Investors Capital Corporation is headquartered in Lynnfield, Massachusetts and is registered with 28 US states and territories. Timothy Murphy is President and Advisors CCO; Stanley Smiley is Vice President; Mark Shelson is Treasurer; Gregory Olson is Secretary; Bernard Breton is BD Chief Compliance Officer.
Per FINRA records (AWC No. 2013035035901), Investors Capital Corporation, from “at least” June 2010 through September 2015, recommended unsuitable short-term UIT transactions in the accounts of several customers. Two representatives allegedly executed 971 short-term UIT transactions in eleven accounts, though UITs are typically intended as long-term investments, and come with “significant upfront charges,” according to FINRA’s complaint, which also notes that “similar to mutual funds that carry front-end sales charges, short-term trading of UITs may not be appropriate.”
FINRA alleges that the transactions were unsuitable for the customers in question, including a 58-year old customer with long-term and growth objectives who “lost $50,728 as a result of these transactions”; a 68 year-old customer with an income amount objective who “lost $32,607 as a result of these transactions”; and a 60 year-old customer with a short-term growth objective who “lost $15,403 as a result of these transaction.” According to FINRA, “as a result of all the unsuitable UIT recommendations, ICC customers suffered losses in the amount of approximately $242,892.”
Investors Capital Corporation also allegedly recommended unsuitable Steepeners—“complex structured products that allow customers to bet on the shape of the yield curve”—and had inadequate supervisory systems related to UIT and Steepener transactions. The firm consented to a censure, a fine of $250,000, and restitution totaling more than $841,500.
If you or someone you know has a complaint regarding Investors Capital Corporation, call the securities and investment fraud law firm Fitapelli Kurta at 877-238-4175 for a free consultation. You may be able to recover lost funds. Fitapelli Kurta accepts all cases on contingency: we only get paid if and when you collect money. You may have a limited window to file your complaint, so we encourage you to avoid delay. Call 877-238-4175 now to speak to an attorney for free.