A panel of arbitrators decided that a Miami broker will be permitted to expunge a customer complaint from his public BrokerCheck record, Advisor Hub reports.
The three public arbitrators issued their award in the case of Adam M. Weirich, who has been registered since 2007 with Equitable Advisors. They recommended that he be able to clear a $98,400 settlement over allegedly unsuitable investment recommendations.
The panel found the claim was “factually impossible or clearly erroneous” due mainly to the financial knowledge of the investor who filed the complaint, a lawyer and Certified Public Accountant with nearly $10 million in assets. The arbitrators said this background gave the client “qualified investor” status, which allows for “a presumption of a higher level of financial sophistication and a greater tolerance of risk, which may allow, as suitable, the recommendation of investments that are of a greater complexity, less transparency, subject to less disclosure, and reduced regulatory oversight.” It was determined that the client understood and accepted the risks associated with the investment.
The allegations, covering the period from 2012 to 2014, marked the only customer complaint on Weirich’s 27-year-record.
The arbitration award provides further insight on the relationship between Weirich and the customer, which was said to have begun after the client was referred by a third-party money manager “after first doing his own independent research on an esoteric trading strategy.”
The arbitrators write that the customer’s application for an account “reflected his prior experience with alternative investments, and the diversity of his portfolio, which included insurance products and managed accounts.” The award states he had listed “Growth” as his investment objective, “Moderate-Plus” as his risk tolerance, and an intermediate to long-term horizon on that application.
He “acknowledged that he received all the relevant prospectuses and disclosures,” and “did not dispute” Weirich’s “assertion that many hours and many meetings and many phone calls were devoted to answering his questions while he made his own, very thorough due diligence,” the arbitrators state.
Though the investor, who was not identified, claimed he had started with Weirich as “totally innocent and unknowledgeable concerning alternative investments, his account application documents…indicate otherwise,” the panel wrote.
The investor, who attended the hearing, did not oppose the expungement request but did express disagreement with FINRA’s method of reporting customer complaints.
Weirich was held responsible for $2,300 in hearing fees. Equitable did not take a position or oppose Weirich’s expungement request.
The attorneys at Hyman Cotter PC have considerable experience with FINRA’s procedures for expunging false, defamatory and erroneous disclosures from a registered representative’s record. If you have any concerns about problematic disclosures on your CRD record or those that are viewable on FINRA’s BrokerCheck portal, contact Hyman Cotter PC at 312-291-4600 or through our online contact form for a free consultation.
