D.A. Davidson & Co. (“D.A. Davidson”) (CRD #199) has many different complaints filed by FINRA (Financial Industry Regulatory Authority), state regulatory organizations, and investors such as yourself. At the Law Offices of Robert Wayne Pearce, we have investigated D.A. Davidson, its regulatory and customer complaints, and have also represented investors with claims of fraud, negligence, and breach of fiduciary duty against this organization and its financial advisors.
If you believe you have a claim against D.A. Davidson, you should strongly consider hiring an investment fraud lawyer. You should not wait until it’s too late to file a claim. The Law Offices of Robert Wayne Pearce, P.A., offers free consultations. Give us a call at 800-732-2889. Let’s discuss your case and see what we can do to help you get the compensation you need and deserve.
Can I Sue D.A. Davidson?
If you’ve lost money caused by D.A. Davidson and/or its employees’ misconduct then the answer is, YES, you can sue D.A. Davidson, but the odds are you signed away your right to sue in court and agreed to resolve your dispute in a FINRA arbitration proceeding. Attorney Robert Wayne Pearce has over 40 years of personal experience in FINRA arbitration proceedings and knows very well how you can not only sue D.A. Davidson in FINRA arbitration proceedings but WIN that arbitration. The easiest way to know if you have a viable case against D.A. Davidson is to call Attorney Pearce at our office at 800-732-2889.
Investment Losses? We Can Help
Discuss your legal options with an attorney at The Law Offices of Robert Wayne Pearce, P.A.
or, give us a ring at (800) 732-2889.
What is D.A. Davidson?
D.A. Davidson(CRD #199) is a registered broker-dealer. It operates as a full-service independent broker-dealer, providing a range of financial products and services to individual investors and financial advisors.
As a registered broker-dealer, D.A. Davidson is subject to regulations and oversight by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA). It is required to comply with industry standards and regulations to ensure the protection of its clients’ interests.
A failure to comply with industry standards by either its brokers or the firm itself can result in disciplinary actions, fines, or other penalties imposed by regulatory authorities.
D.A. Davidson Has Many Different Regulatory Problems
D.A. Davidson’s rapid growth has not been without consequences. There have been approximately 41 state and self-regulatory body disclosure events; that is, final and formal proceedings initiated by a regulatory authority (e.g., a state or federal securities agency like the U.S. Securities and Exchange Commission (SEC) or self-regulatory body like the Financial Industry Regulatory Authority (FINRA) and the North American Securities Administrators Association (NASAA) for a violation(s) of investment-related rules or regulations. In addition, there have been many customer complaints filed against D.A. Davidson for misconduct by its securities sales and investment advisory representatives that are not reported by the firm on its Central Depository Record.
We have reported and written about these regulatory problems and customer complaints over many years. D.A. Davidson is a repeat offender: there are over 41 FINRA-reported proceedings citing the firm with one form of supervisory lapses or another.
A Brief Overview of Some of the Regulatory Problems D.A. Davidson Has Faced Over the Years*
D.A. Davidson has been repeatedly censured, warned, and fined multi-millions of dollars for its own misconduct and failure to supervise its army of financial advisors.* A few of the notable FINRA Sanctions for its Supervisory Failures are below:
FINRA Censures and Fines D.A. Davidson for Inaccuracies in Issue Price Certificates in Connection with Municipal Offerings
Brief Overview: Without admitting or denying the findings, D.A. Davidson consented to the sanctions and to the entry of FINRA findings that it provided inaccurate or misleading statements in its issue price certificates in connection with municipal offerings. FINRA stated that the firm acted as the sole underwriter for numerous municipal offerings and, in its capacity as sole underwriter, prepared and provided issuers with issue price certificates in connection with the offerings. Issue price certificates typically include representations that, among other things, at least ten percent of each maturity of the bonds were first sold to the public at the initial offering prices set forth in the official statement for the offering. However, the inaccurate or misleading statements of the firm were regarding the percentage of each maturity that was sold, or was reasonably expected to be sold, to the public. D.A. Davidson was censured and fined $85,000.00.
D.A. Davidson Censured and Ordered to Cease-and-Desist for Failing to Disclose Mutual Fund Fees Received
Brief Overview: The SEC censured and issued a cease-and-desist order after findings of breaches of fiduciary duty and inadequate disclosures by D.A. Davidson in connection with its mutual fund share class selection practices and the fees it received. During the relevant period, the firm purchased, recommended, or held for advisory clients mutual fund share classes that charged 12b-1 fees instead of lower-cost share classes of the same funds for which the clients were eligible. The firm received 12b-1 fees in connection with these investments but failed to disclose in its Forn ADV or otherwise the conflicts of interest related to (1) its receipt of 12b-1 fees, and/or (2) its selection of mutual fund share classes that pay such fees. The firm received 12b-1 fees during this time for advising clients to invest in or hold such mutual fund share classes.
FINRA Censures and Fines D.A. Davidson for Charging Customers Higher Mutual Fund Fees than They were Actually Required to Pay
Brief Overview: Without admitting or denying the findings, D.A. Davidson consented to the sanctions and to the entry of FINRA findings that it disadvantaged certain retirement plan and charitable organization customers that were eligible to purchase class a shares in certain mutual funds without a front-end sales charge. FINRA stated that these eligible customers were instead sold Class A shares with a front-end sales charge, or Class B or C Shares with back-end sales charges and higher ongoing fees and expenses. These sales disadvantaged eligible customers by causing them to pay higher fees than they were required to pay. FINRA findings also stated that the firm failed to reasonably supervise the application of sales-charge waivers to eligible mutual fund sales; the firm allegedly relied on its financial advisors to determine the applicability of sales charge waivers but failed to maintain adequate written policies or procedures to assist financial advisors in making this determination. In addition, the firm failed to adequately notify and train its financial advisors regarding the availability of mutual fund sales charge waivers for eligible customers, and the firm failed to adopt adequate controls to detect instances in which they did not provide sales-charge waivers to eligible customers in connection with their mutual fund purchases.
Vermont Department of Financial Regulation Fines D.A. Davidson for Broker’s Unregistered Transactions
Brief Overview: The Vermont Department of Financial Regulation found that D.A. Davidson failed to have adequate supervisory systems and written procedures that resulted in one broker effecting 9 unregistered transactions in the state of Vermont. As a result, the firm agreed to resolve the matter by paying a fine of $60,000.00; agreeing to revise policies & procedures to ensure that when an unregistered Vermont transaction is identified, either (a) it is placed on hold or (b) the transaction will be effected by another agent who is registered in Vermont; and agreeing to revise policies & procedures relating to trust accounts and multiple co-trustees.
SEC Issues Cease-and-Desist Order to D.A. Davidson for Inadequate Due Diligence of Municipal Debt Offerings
Brief Overview: The SEC ordered D.A. Davidson to cease-and-desist for violations of an antifraud provision of the federal securities laws in connection with the firm’s underwriting of certain municipal securities offerings. The firm allegedly conducted inadequate due diligence in certain offerings and as a result, failed to form a reasonable basis for believing the truthfulness of certain material representations in official statements issued in connection with those offerings. This resulted in the firm offering and selling municipal securities based on materially misleading disclosure documents.
*Above are only some of the regulatory disciplinary actions filed against D.A. Davidson by FINRA. NASAA and other state securities regulator investigations and enforcement actions account for another 36 BrokerCheck disclosures.
D.A. Davidson Customer Complaints
There have been scores of customer complaints filed against D.A. Davidson stockbrokers and investment advisors over the years. We have launched many investigations of current and former D.A. Davidson advisors:
- Mark Nicholson of D.A. Davidson
- Megan Phillips of D.A. Davidson
- Gregory Tucker of D.A. Davidson & Co.
- Neil Berlant formerly with D.A. Davidson & Co.
- Scott Sideras of D.A. Davidson & Co.
- Theodore Rich of D.A. Davidson & Co.
- Suzette Lawrence of D.A. Davidson & Co
- Andrew Schell formerly with D.A. Davidson & Co
If you have lost money investing with any of these D.A. Davidson advisors or others within this brokerage firm, it’s important that you reach out to an investment loss attorney quickly because the statutes of limitations can bar your claims. Call us at 800-732-2889.
Why Does D.A. Davidson Have So Many Regulatory Problems And Customer Complaints?
Independent broker-dealers are notorious for their lax supervisory practices and procedures. The business model of these franchise type operations is to open many offices nationwide for steady growth of fixed monthly revenues without the costs attendant to a full-service branch office with on-site manager, compliance officer and operation personnel. The registered representatives of these independent broker-dealers generally operate as separately incorporated businesses. They are not employees of the broker-dealer and therefore not controlled in the same manner as full-service brokerage firm representatives. The registered representatives control their structure and costs to maximize profits and often leave the protection of investors’ rights and interests as their lowest priority.
The typical supervisory organization of independent broker-dealer operations is to have other independent contractors operate Offices of Supervisory Jurisdiction (OSJs) to monitor the registered representatives from geographically remote offices and then report to the main franchisor’s compliance office at national headquarters. The supervisors at the OSJs are not employees of the franchisor and often run their own brokerage, insurance and other businesses. They are not devoted full-time supervisors of the smaller branch offices. Consequently, OSJ managers cannot and do not supervise the day-to-day operations of the registered representatives of these Independent broker-dealers.
Generally, there is no immediate review of new accounts opened, securities transactions, business records, cash or securities receipts and deliveries, correspondence and business activities unrelated to the securities brokerage operation at these independent brokerage firms. The lax supervision leaves investors who have transferred their accounts to the smaller independent broker-dealer vulnerable to sales of securities that have not been reviewed or authorized by anyone other than the sales representative earning a commission. There may be no one onsite to detect forgeries of clients’ signatures on documents, the placement of inaccurate information about a client’s investment objectives and financial condition to document the suitability of a particular investment recommendation. Oftentimes there is no daily review of sales literature and client correspondence to protect against misrepresentations and misleading statements being made to investors. In fact, it is not unusual for there to be only one compliance audit visit per year at many of these offices.
These Independent brokerage business operations are worrisome to the North American Securities Administrators Association (NASAA), which has documented more instances of sales abuse and consequently investor losses at these firms than the traditional brokerage firms with branch offices with on-site managers and compliance personnel.
Did D.A. Davidson Advisor Misconduct Cause You Investment Losses?
When financial advisor misconduct has caused you to lose substantial value to your investment accounts, you have the right to seek reimbursement from the responsible parties. D.A. Davidson is responsible like any employer for its financial advisors acts and omissions. In addition, it has an independent duty to supervise its stockbrokers and investment advisors. These cases can be extremely complex, and so having the support of a reputable attorney who is experienced in recovering investment losses for investors is key to your success. Many customers make the mistake of contacting D.A. Davidson without representation with an attorney about their complaints and have their complaints denied.
Related Read: Can You Sue Your Brokerage Firm?
Investment Losses? We Can Help
Discuss your legal options with an attorney at The Law Offices of Robert Wayne Pearce, P.A.
or, give us a ring at (800) 732-2889.
Consult With An Attorney Who Recovers Investment Losses Caused By D.A. Davidson Today!
The investment loss attorneys at The Law Offices of Robert Wayne Pearce, P.A., have helped countless investors over the last 40 years recover the losses from their investment accounts that were caused by broker negligence or misconduct. The firm has extensive experience with D.A. Davidson cases, and Attorney Pearce is committed to seeing that those responsible for the losses you have suffered are held fully accountable.
Give us a call at 800-732-2889. Let’s discuss your case and see what we can do to help you get the compensation you need and deserve.
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