Royal Alliance Associates, Inc. (“Royal Alliance”) (CRD # 23131) has been cited in numerous complaints by the Financial Industry Regulatory Authority (“FINRA”), U.S. Securities and Exchange Commission (“SEC”), state securities regulators, and investors because the firm failed to supervise its representatives and violated securities laws. At the Law Offices of Robert Wayne Pearce, we have investigated Royal Alliance complaints and its regulatory problems, and we have 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 Royal Alliance, you should strongly consider hiring an investment fraud attorney. Investors who lost money due to Royal Alliance misconduct have the right to pursue compensation through FINRA arbitration, even if they signed arbitration agreements. 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. Let’s discuss your case and see what we can do to help you get the compensation you need and deserve.
Can I Sue Royal Alliance Associates, Inc.?
If you’ve lost money caused by Royal Alliance and/or its employees’ misconduct then the answer is, YES, you can sue Royal Alliance 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 extensive personal experience in FINRA arbitration proceedings and knows very well how you can not only sue Royal Alliance in FINRA arbitration proceedings, but WIN that arbitration. The easiest way to know if you have a viable case against Royal Alliance is to contact Attorney Pearce at our office.
How to Sue Royal Alliance Associates, Inc. for Investment Losses
What Can I Do If I Lost Money at Royal Alliance Associates, Inc.?
If you lost money at Royal Alliance Associates, Inc., you have the right to pursue compensation through FINRA arbitration because Royal Alliance has a documented history of supervisory failures that led to investor losses. FINRA arbitration is a specialized dispute resolution process designed specifically for securities disputes where claims are heard by a panel of arbitrators rather than a jury. The process is less formal than court litigation, typically moves faster than traditional lawsuits, and investors can pursue claims even if they signed arbitration agreements with Royal Alliance.
Royal Alliance’s regulatory problems—including SEC sanctions for volatility-linked ETP violations, FINRA fines for failing to prevent theft of over $3.8 million from customers, and multiple cases of mutual fund share class abuse—directly demonstrate how the firm’s supervisory failures may have affected your investments. These documented violations show a pattern of inadequate oversight that could support your claim. When broker-dealers fail to properly supervise their representatives, investors suffer losses from unsuitable investments, excessive trading, unauthorized transactions, or outright fraud.
The Law Offices of Robert Wayne Pearce specializes in these exact types of cases against Royal Alliance. Our firm has handled hundreds of FINRA arbitration cases and understands the specific regulatory violations and supervisory failures that have plagued Royal Alliance for years. We know how to connect Royal Alliance’s documented compliance failures to the losses you suffered and how to build a compelling case that holds the firm accountable.
Who Can Help Me Sue Royal Alliance Associates, Inc.?
The Law Offices of Robert Wayne Pearce, P.A. can help you sue Royal Alliance Associates, Inc. for investment losses because we specialize exclusively in securities arbitration and have a deep understanding of Royal Alliance’s specific regulatory problems and supervisory failures. Our firm has successfully represented investors in recovering losses from broker misconduct at independent broker-dealers like Royal Alliance, where lax supervision creates opportunities for fraud and abuse. We offer free consultations to evaluate your case and can explain how Royal Alliance’s documented compliance failures may support your claim for compensation.
What is Royal Alliance Associates, Inc.?
Royal Alliance (CRD # 23131) was founded in 1969 and engaged in its broker-dealer and/or investment advisory businesses since that time. It is indirectly controlled by the Advisor Group, Inc. and headquartered in Jersey City, New Jersey with branch offices located throughout the United States. Its independent broker-dealer Business Model has grown through acquisition and organic development of primarily one and two person registered representative offices supervised remotely. Today there are over 800 Royal Alliance branch offices with over 2000 registered representatives in almost every state. It is now part of one of the largest broker-dealer and investment advisory firm networks in the United States with over 11,000 affiliated stockbrokers and financial advisors.
Why Does Royal Alliance Associates, Inc. Have So Many Bad Reviews And Customer Complaints?
Royal Alliance has many bad reviews and customer complaints because independent broker-dealers like Royal Alliance operate with weak supervision systems that leave investors vulnerable to misconduct. The firm uses a franchise-style business model where most offices have only one or two financial advisors working as independent contractors, not employees, which means Royal Alliance has less direct control over their daily activities compared to traditional brokerage firms.
These independent advisors are supervised remotely by other independent contractors who run Offices of Supervisory Jurisdiction (OSJs) from geographically distant locations. OSJ managers often operate their own separate businesses and are not full-time supervisors dedicated exclusively to monitoring the representatives they oversee. This structure means nobody is watching over financial advisors on a day-to-day basis when they make investment recommendations, open new accounts, or conduct transactions with your money.
There is typically no immediate review of new accounts, securities transactions, business records, or client correspondence at these independent brokerage offices. This lack of oversight creates opportunities for unsuitable investment recommendations that haven’t been reviewed or authorized by anyone other than the sales representative earning a commission. There may be no one present to detect forged signatures on documents, inaccurate information about your investment objectives to justify inappropriate investments, or misleading statements being made to clients. Many of these offices receive only one compliance audit visit per year.
The North American Securities Administrators Association (NASAA) has documented more instances of sales abuse and investor losses at independent broker-dealers like Royal Alliance than at traditional brokerage firms with on-site managers and compliance personnel. This is why investors at Royal Alliance face higher risks and why the firm has accumulated so many regulatory problems and customer complaints over the years.
Royal Alliance Associates, Inc. has Many Different Regulatory Problems
Royal Alliance rapid growth has not been without consequences. There have been approximately 42 Federal, 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 hundreds of customer complaints filed against Royal Alliance 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. Royal Alliance is a repeat offender: there are over 21 SEC and FINRA and another 21 state regulator disciplinary proceedings citing the firm with one form of supervisory lapses or another.
A BRIEF OVERVIEW OF SOME OF THE REGULATORY PROBLEMS ROYAL ALLIANCE HAS FACED OVER THE YEARS*
Royal Alliance has been repeatedly censured, warned, and fined millions for its own misconduct and failure to supervise its army of financial advisors.* A few of the notable SEC and FINRA Sanctions for its Supervisory Failures are below:
SEC Sanctions Royal Alliance Complex Exchange -Traded Product Sales Abuses
In 2020, Royal Alliance entered into an SEC Consent Order with findings related to violations of Section 206 and Rule 206(4)-7 of the Investment Advisers Act of 1940. The SEC found that Royal Alliance did not adopt and implement policies and procedures reasonably designed to prevent unsuitable investments by its Advisory Representatives in volatility-linked exchange traded products (“ETPs”). Without admitting or denying the SEC’s findings, Royal Alliance agreed to cease and desist from committing or causing any violations and any future violations of Section 206(4) of the Advisers Act and Advisers Act Rule 206(4)-7. The Firm also agreed to pay disgorgement, prejudgment interest, and a civil monetary penalty totaling $502,400.29. The SEC noted that the Firm cooperated with the SEC and promptly took remedial steps relating to volatility linked ETPs and imposed restrictions on holding them in all client accounts maintained at the Firm.
The SEC Sanctions Royal Alliance And Its Affiliates Almost $10 Million For Mutual Fund Share Classes and Wrap Accounts Sales Abuses
On March 14, 2016, Royal Alliance, and its affiliates, SagePoint Financial, Inc. and FSC Securities Corporation (collectively, the “Advisor Group Firms”) consented to the entry of an SEC Order Instituting Administrative and Cease and-Desist Proceedings (“Order”). The Order focuses on two specific issues related to the Advisor Group Firms fee-based advisory business. The SEC found that the Advisor Group Firms placed certain advisory clients invested in the Advisor Managed Portfolios program in mutual fund share classes with higher expense costs when lower expense cost share classes of those funds were available. The SEC found that this financial incentive, to place non-qualified advisory clients in higher fee share classes, presented a conflict of interest that should have been disclosed to clients. The SEC also concluded that the Advisor Group Firms failed to adopt written compliance policies or procedures governing mutual fund share class selection. In addition, the SEC found the Advisor Group Firms failed to timely monitor certain wrap advisory accounts for inactivity pursuant to Advisor Group’s written compliance policies and procedures. Without admitting or denying the SEC’s findings, the Advisor Group Firms agreed to cease and desist from committing or causing any violations and any future violations of Sections 206(2), 206(4) and 207 of the Investment Advisers Act and Rule 206(4)-7 thereunder and to jointly pay disgorgement of $1,956,460 and prejudgment interest of $93,399, a civil penalty of $7,500,000.
FINRA Censures And Fines Royal Alliance For Supervisory Failures To Prevent Thefts Of Over $3.8 million From Customers
Two registered representatives at Royal Alliance, acting independently of each other, stole customer funds by directing wire transfers or checks from customer accounts into accounts for entities they created. Some of the transfers were made in violation of firm policies and procedures for third-party payments, which the firm failed to enforce, and in some instances the transfers were also accompanied by red flags to which the firm failed to reasonably respond. FINRA censured and fined Royal Alliance $400,000 for its supervisory failures.
Ameriprise Censured And Fined For Not Sending Account Records To Customers
FINRA investigated and found Ameriprise failed to create and send to approximately 219,000 customers an account record within 30 days of the account opening for each of these customers and therefore violated SEC Rule 17a-3, former NASD Rule 3110 (now FlNRA Rule 4511) and FINRA Rule 2010. In addition, in violation of NASD Rule 3010 and FINRA Rule 2010, Ameriprise failed to establish, maintain, and enforce a supervisory system and written supervisory procedures reasonably designed to ensure compliance with applicable laws and regulations relating to the creation and distribution of account records at account opening.
FINRA Sanctions Royal Alliance For Excessive Unit Investment Trust Sales Charges
FINRA investigated and found that Royal Alliance failed to identify and apply sales charge discounts to certain customers’ eligible purchases of unit investment trusts (UITs) resulting in customers paying excessive sales charges of approximately $204,000. FINRA also alleged that Royal Alliance failed to establish, maintain and enforce a supervisory system and Written Supervisory Procedures (WSPs) reasonably designed to ensure that customers receive sales charge discounts on all eligible UIT purchases. Royal Alliance paid its customers restitution and was fined for its alleged misconduct.
FINRA Sanctions Royal Alliance For Variable Annuity Sales Abuse
Royal Alliance, and its affiliates, FSC, SagePoint, and Woodbury (collectively, the “Advisor Group Firms”) failed to establish, maintain and enforce a supervisory system and written procedures designed to reasonably supervise representatives’ sale of multi-share class variable annuities and failed to provide training to their representatives and principals on the sale and supervision of multi-share class variable annuities. As a result, the Advisor Group Firms violated FINRA Rules 2330(d) and (e), NASD Rule 3010 (for conduct before December 1, 2014), F1NRA Rule 3110 (for conduct on and after December 1, 2014), and FINRA Rule 2010.
In addition, Royal Alliance failed to reasonably supervise variable annuity exchanges in that it failed to implement a reasonable supervisory system and procedures to determine if any of its registered representatives had inappropriate rates of variable annuity exchanges. As a result, Royal Alliance violated FINRA Rule 2330(d), NASD Rule 3010, FINRA Rule 3110, and FINRA Rule 2010.
Royal Alliance Sanctioned For Failing to Protect Customers From Ponzi Scheme
Royal Alliance was sanctioned by the SEC for failing reasonably to supervise a registered representative with a view to preventing and detect a Ponzi Scheme and the representatives violations of the federal securities laws During the relevant period, the Royal Alliance registered representative operated a Ponzi scheme and defrauded at least 28 investors by lying about purchases and sales of securities, by misappropriating funds for his personal use, and by sending certain investors falsified statements relating to their investment accounts. Royal Alliance was censured and ordered to pay a $500,000 penalty.
FINRA Sanctions Royal Alliance For Charging Customers Unfair Municipal Bond Prices
FINRA charged Royal Alliance, a municipal securities dealer, for failing to purchase municipal securities for its own account from a customer or sell municipal securities for its own account to a customer at an aggregate price (including any markdown or markup) that was fair and reasonable, taking into consideration all relevant factors, including the best judgment of the firm as to the fair market value of the securities at the time of the transaction and of any securities exchanged or traded in connection with the transaction, the expense involved in effecting the transaction, the fact that the firm was entitled to a profit, and the total dollar amount of the transaction. The conduct described in this paragraph constitutes separate and distinct violations of MSRB Rules G-17 and G-30.
FINRA also found that Royal Alliances supervisory system during the review period did not provide for supervision reasonably designed to achieve compliance with respect to the applicable securities laws and regulations, and the Rules of the MSRB, concerning the firm’s fair pricing of and markups on municipal bond transactions. The conduct described in this paragraph constitutes separate and distinct violations of MSRB Rules G-17 and G-27.
FINRA Sanctions Royal Alliance For Mutual Fund Switching Sales Abuse
FINRA issued findings against a registered representative formerly associated with Royal Alliance because the advisor made unsuitable mutual fund recommendations and misrepresentations in connection with the recommendations. The Royal Alliance advisor recommended a series of 167 unsuitable mutual fund switches and exchanges in three accounts jointly held by public customers without having a reasonable basis for recommending the switches and exchanges which resulted in payment by the customers of over $75,600 in unnecessary mutual fund fees and commissions totaling $51,963.
FINRA also found Royal Alliance failed to have supervisory systems in place that were sufficient to detect the unsuitable switches and exchanges made by Coody. The system was also inadequate to detect the stockbrokers failure to take advantage of cost-free exchanges, rights of accumulation, and customer savings available through the use of letters of intent or rights of accumulation. In some instances, Royal Alliance also failed to ensure that customers received switch letters disclosing costs or fees associated with the switch of one mutual fund A share for another.
FINRA Sanctions Royal Alliance For Mutual Fund Sales Charges
During the relevant period, Royal Alliance failed to provide certain investors the opportunity to purchase Class A shares of certain mutual funds at net asset value (“NAV”). In particular, certain mutual funds offered “NAV Transfer Programs” that allowed investors to purchase Class A shares at NAV and not pay any sales charges, if the customer invested proceeds from the redemption of shares of another mutual fund within specified time frames and previously had paid either a front-end or back-end sales charge.
During the relevant period, Royal Alliance also failed to exercise reasonable due diligence to identify the essential terms and conditions of the NAV Transfer programs of certain mutual funds, and failed to establish, maintain and enforce a system and procedures to ensure that its customers received NAV pricing when appropriate. As a result, certain investors who were eligible to purchase Class A shares under NAV Transfer Programs (1) purchased Class A shares and incurred front-end sales charges that they should not have paid, and/or (2) purchased other share classes of these mutual funds and thereby became subject to back-end sales charges, also known as contingent deferred sales charges (“CDSCs”), as well as higher ongoing distribution and service fees (“Rule 12b-l fees” or “fees”), typically associated with share classes other than Class A.
*Above are only some of the regulatory disciplinary actions filed against Royal Alliance by FINRA. NASSA and other state securities regulator investigations and enforcement actions account for another 33 BrokerCheck disclosures.
How to File an Official Complaint Against Royal Alliance Associates, Inc. or One of Its Brokers with FINRA
If you believe you have been the victim of investment fraud or broker misconduct by Royal Alliance Associates, Inc. or one of its registered representatives, you can file an official complaint with FINRA. FINRA maintains a complaint center where investors can report concerns about broker-dealers and their representatives. Filing a complaint with FINRA creates an official record of your concerns and can trigger regulatory investigations into the conduct you report.
To file a complaint with FINRA, visit the FINRA Investor Complaint Center online or contact FINRA by phone. When filing your complaint, provide as much detail as possible about the misconduct you experienced, including dates, specific transactions, names of individuals involved, and documentation such as account statements, trade confirmations, or correspondence. The more specific information you provide, the more effectively FINRA can investigate your complaint.
However, filing a complaint with FINRA is not the same as pursuing a claim for financial recovery. FINRA’s complaint process is primarily a regulatory function designed to protect other investors by identifying problem brokers and firms. While filing a complaint is important and helps regulators hold wrongdoers accountable, it does not directly result in compensation for your losses. To recover money lost due to Royal Alliance misconduct, you need to pursue a FINRA arbitration claim with the assistance of an experienced securities attorney.
How The Law Offices of Robert Wayne Pearce, P.A. Can Help You Recover Losses at Royal Alliance Associates, Inc.
The Law Offices of Robert Wayne Pearce, P.A. assists investors in navigating both the FINRA complaint process and the FINRA arbitration process to pursue compensation for investment losses. Our firm handles all aspects of building and presenting your case, from gathering evidence and analyzing Royal Alliance’s supervisory failures to presenting your claim before arbitration panels. With over 45 years of experience in securities arbitration and a track record of recovering over $175 million for investors, Attorney Robert Wayne Pearce understands how to hold broker-dealers accountable for the misconduct of their representatives.
We offer free consultations to evaluate your case and explain your legal options. During your consultation, we can review your account history, assess the strength of your claim, and explain how Royal Alliance’s documented regulatory problems may support your case for recovery. Contact our office to discuss your situation and learn how we can help you pursue the compensation you deserve.
Did Royal Alliance Associates, Inc. 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. Royal Alliance 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 Royal Alliance without representation with an attorney about their complaints and have their complaints denied.
Consult With An Attorney Who Recovers Investment Losses Caused By Royal Alliance Today
The securities lawyers at The Law Offices of Robert Wayne Pearce, P.A., have helped countless investors over the last 45 years recover the losses from their investment accounts that were caused by broker negligence or misconduct. The firm has extensive experience with Royal Alliance 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.
