FINRA Suspended Ex-Iowa Stockbroker in 2018 For Selling Away
John Michael Krohn, a former Iowa broker with Principal Securities, is named in three customer disputes in which the claimants are collectively pursuing over $39.2M in damages for losses they sustained while working with him.
The investors contend that Krohn engaged in selling away, which involves offering them investments that his then-brokerage firm of record never approved. They are pursuing damages against Principal Securities, where Krohn was a registered representative for 20 years.
In 2018, the Financial Industry Regulatory Authority (FINRA) suspended him for three months after finding that he sold away $7.9M of private securities transactions. He also was ordered to pay a $10K penalty.
What is Selling Away?
Our securities fraud attorneys are looking into claims of losses by former customers of ex-Principal Securities broker, John Krohn. Contact us at Shepherd Smith Edwards and Kantas (SSEK Law Firm at investorlawyers.com) so that we can help you explore your legal options.
Pending Customer Disputes Against Broker John Krohn
According to BrokerCheck, there are three pending disclosures involving John Krohn, including:
- April 2020: The claimants are pursuing a broker fraud claim against Principal Securities for failing to adequately supervise Krohn. They are requesting $10M in damages.
- February 2020: Alleging selling away and failure to supervise, these claimants are seeking $1.2M from Principal Securities.
- February 2019: These investors are seeking $28M in damages. They are accusing Krohn of soliciting money from them for companies that he at least partially owned, oversaw, or controlled.
Two earlier claims from 2017, one alleging selling away involving a private placement and another claiming unsuitability involving a variable annuity, were denied.
It is common for customers that were harmed by a broker’s actions to file their FINRA arbitration claim against the broker-dealer whose failure to properly supervise enabled or allowed fraudulent or negligent activities to occur.
According to InvestmentNews, Principal Securities, in its yearly audited financial statement to US Securities and Exchange Commission (SEC), noted that one of Krohn’s former clients, a family, will have their FINRA arbitration hearing against Principal Securities in August. They are the ones seeking $28M in damage.
Seasoned Selling Away Lawyers
Our selling-away attorneys have been fighting for investors for over 30 years. If you believe that you fell victim to broker negligence or another type of securities fraud, get in touch with our lawyers today. Contact SSEK Law Firm at (800) 259-9010 to request your free, no-obligation case consultation.