Stock broker Ryan Featherston of Tulsa, Oklahoma is involved in legal disputes with two customers, one who alleges “unauthorized trading and misrepresentation in connection with investments” and one who alleges “improper conduct . . . in connection with reliance on power of attorney and resulting investments.” Featherston was a registered agent of the firm Edward Jones from March 2011 to September 2014. He subsequently joined the firm LPL Financial where he worked until April of last year.
It is a violation of securities regulations for a broker to engage in discretionary trading in a customer’s account unless the broker has obtained written permission to do so from both the customer and the broker’s firm. See FINRA Rule 2510(b) (“[n]o member or registered representative shall exercise any discretionary power in a customer’s account unless such customer has given prior written authorization to a stated individual or individuals and the account has been accepted by the member.”). In the absence of discretionary trading authority, a broker’s discretion is strictly limited to time and price discretion within a single trading day. FINRA Rule 2510(d)(1). The broker has no discretion over which securities to trade or in what quantities to trade them.
There are a multitude of state and federal statutes that make it unlawful to mislead and defraud investors in connection with the purchase or sale of securities. The best known of these laws is Section 10(b) of the Securities Exchange Act of 1934, which is a federal statute. Each of the 50 States has its own set of securities laws, known as “blue sky” laws. Many States have modeled their blue sky laws on the Uniform Securities Act, which contains a variety of different civil liability provisions.
Stock brokers have a duty to recommend suitable investments and investment strategies to their clients. A recommendation is only suitable if it comports with the client’s investment objectives, risk tolerance, investment experience, investment time horizon, liquidity needs, and income needs. Together these considerations form the investor’s unique “investment profile.” The duty to recommend suitable investments cannot be disclaimed through risk disclosures or waivers.
If you have suffered investment losses as a result of the malpractice or misconduct of Ryan Featherston, our experienced team of securities attorneys may be able to assist you in recovering some or all of your losses. Call us toll-free at 888-607-4819 for a free consultation or email us through our “Contact” page to schedule a free consultation.