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Regulation and Compliance > Federal Regulation > FINRA

FINRA Panel Orders Missouri Firm to Fork Over $750K

By Jeff Berman

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A Financial Industry Regulatory Authority arbitrator on Thursday ordered Clayton, Missouri-based Huntleigh Securities to pay $750,000 in combined damages and legal fees to a customer who claimed a rep at the firm made unsuitable investments on her behalf, according to FINRA.

Huntleigh and Patrick A. Watts of Watts Law Group, which represented the firm, did not immediately respond to a request for comment Friday, one day after the FINRA Office of Dispute Resolution posted the award on the regulator’s website.

In her statement of claim, Cynthia A. Burch asserted causes of action that included breach of fiduciary duty, common law fraud, negligence/negligent misrepresentation/omission, breach of contract, unjust enrichment and negligent supervision. She also claimed the firm violated Missouri’s Securities Act Section 409-5.501.

Burch claimed the the firm, through its registered representative, “while managing a discretionary account on behalf of Claimant and contrary to Claimant’s investment objectives and risk tolerance, invested Claimant’s assets in highly speculative, high-risk stocks and options, leveraged Claimant’s accounts on margin, and engaged in excessive trading.” The rep was not named.

The award granted by the three-person panel included $300,000 in compensatory damages, $200,000 in punitive damages and $250,000 in attorneys’ fees.

Oakes & Fosher, the law firm representing Burch, did not immediately respond to a request for comment on the panel’s award.

Jeff Berman

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