Former United Planners Broker Jerry Lou Guttman allegedly sold over $7,000,000 worth of unregistered securities to customers of his former employer. Guttman allegedly sold membership interests in at least six different limited liability companies to 31 customers and seven non-customers without first disclosing the sales to United Planners, according to a recent Letter of Acceptance, Waiver, and Consent (AWC) issued by the Financial Industry Regulatory Authority (FINRA). According to the AWC, Mr. Guttman neither admitted to nor denied the conduct charged by FINRA.
Guttman was a financial advisor and a registered representative of United Planners Financial Services of America from 2001 to October 2017. Guttman has also allegedly been the subject of three previous customer complaints. During his career, Guttman has been affiliated with Guttman Financial Group, Nationwide Planning & Benefits, Champion Entertainment Group, Walled Lake Properties, and Serenity Management.
FINRA Rule 3280 prohibits associated persons from participating in any manner in a private securities transaction without first providing written notice to the registered representative’s employing firm. The notice to the employer must occur before the private securities transaction begins. There are other requirements imposed by the rule, including that the employing firm must approve the transaction.
Selling away occurs when a broker or investment adviser sells an investment to a client that is not included in the client’s account or offered by the broker-dealer employer of the broker. These “selling away” transactions often involve investments in private placements, private non-traded REITs, privately-held companies, limited partnerships, real estate and promissory notes.
Selling away cases often involve both the actions of the broker and the supervisory practices of the firm. Often, selling away could have been prevented if the firm’s supervisors had paid attention to certain red flags that should have alerted them to the broker misconduct.
If you have been sold a private placement by a stockbroker or investment advisor, you may be able to recover investment losses in FINRA arbitration if the recommendation lacked a reasonable basis, or the broker did not comply with FINRA rules. Investors may contact a securities arbitration attorney at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 or email@example.com for a no-cost, confidential consultation.