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Former New Port Richey, FL broker is also accused of selling away

Francis Joseph Velten, most recently an Ameriprise Financial Services broker, is now barred by the Financial Industry Regulatory Authority (FINRA). He’s accused of churning in older investors’ accounts and encouraging them to surrender their annuities and mutual fund holdings to buy bonus annuities. This caused them to pay surrender fees while he earned commissions from the transactions.

Churning, which involves excessively trading in customer accounts, is one of the ways many brokers will try to earn additional money through resulting commissions and fees. Unfortunately, this can cause investors substantial losses, especially if done in excess.

For alleged supervisory failures and excessive trading by one of its former brokers, Summit Brokerage Services, Inc. has been ordered to pay over $880K– $558K in restitution with interest to customers that were harmed, as well as a $325K fine to the Financial Industry Regulatory Authority (FINRA). The broker-dealer consented to the entry of the findings but did not admit to or deny wrongdoing.

According to the SRO, from 1/2012 to 3/2017, Summit neglected to review certain automated alerts for the trading activities of its registered representatives, of which there are more than 700. Because of this, one of its brokers, was able to excessively trade in accounts belonging to 14 clients, including 533 trades on behalf of one customer. This compelled her to pay over $171K in commissions.

The broker’s excessive trading resulted in 150 alerts for this type of activity, none of which were purportedly reviewed by Summit. FINRA has since barred the former registered rep.

Articles Tagged with Summit Brokerage Services

Ex-Summit Brokerage Services Financial Advisor Francis Velten Barred Following Churning Allegations in Elderly Customers’ Accounts

Former New Port Richey, FL broker is also accused of selling away

Summit to Pay Over $880K for Excessive Trading, Inadequate Supervision