The Financial Industry Regulatory Authority (FINRA) recently ordered J.P. Turner & Company, LLC, to pay $707,559 in restitution to 84 of its customers after determining that the broker-dealer firm engaged in improper conduct in connection with leveraged and inverse exchange-traded funds (ETFs).
Leveraged and inverse ETFs are complicated and risky investment products that are unsuitable for many investors. FINRA found that J.P Turner’s registered representatives sold these products to many customers despite the fact investments were plainly unsuitable for them. In addition, FINRA found that J.P. Turner failed to train its registered representatives with respect to these products.
It appears that many of J.P. Turner’s registered representatives also engaged in improper mutual fund “switching.” A broker-dealer firm has the obligation to detect unsuitable switches that result in unjustified commissions and sales charges for customers. FINRA found that 2,800 unsuitable mutual fund switches resulted in 66 customers paying commissions and sales charges in the amount of more than $500,000.
It is possible for customers of J.P. Turner to recover losses above and beyond the restitution payments that they will receive as a result of FINRA’s regulatory action by pursuing claims against J.P. Turner in arbitration.
Blau & Malmfeldt invites J.P. Turner customers to contact us at 312-443-1600 for a free consultation. Blau & Malmfeldt is a law firm that represents investors across the United States in securities, commodity futures, partnership and shareholder rights disputes.