• October 20, 2023
• LPL Financial

John Brian Lee (CRD#: 2950037) is a registered broker and financial advisor at LPL Financial LLC, in Fort Worth, TX.

Broker’s Background:

John Lee entered the securities industry in 1999. He previous worked for Cambridge Investment Research Advisors, Inc; MML Investors Services, LLC; Northwestern Mutual Investment Services, LLC; Northwestern  Mutual Wealth Management Company; Nationwide Securities; Morgan Stanley; Morgan Stanley DW Inc.; and Robert W. Baird & CO. Incorporated.

Allegations of Misconduct

According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), in June 2022, John Lee was the subject of a customer dispute which alleged, “Statement of Claim alleges an investment recommendation was made for the purpose of generating high commissions and fees and that Claimants were deprived of the ability to generate reasonable returns that would have been received in a diversified portfolio.” The customer dispute settled for $575,000.

In addition, John Lee has been the subject of two other employment separation disclosures, which include the following:

• August 2021—“ The Financial Professionals office reused client signatures from previously signed client forms with client knowledge.” Cambridge Investment Research, Inc., permitted John Lee to resign.
• September 2010—“ REPRESENTATIVE WAS PERMITTED TO RESIGN WHILE UNDER AN INTERNAL REVIEW INVESTIGATING WHETHER HE WAS INVOLVED IN UNDISCLOSED PRIVATE SECURITIES TRANSACTIONS AND THE SALE OF EQUITY INDEXED ANNUITIES (A/K/A FIXED INDEXED ANNUITIES) IN VIOLATION OF FIRM POLICY.” Northwestern Mutual Investment Services, LLC, permitted John Lee to resign.

For a copy of John B. Lee’s FINRA BrokerCheck, click here.

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Financial advisors have a legal and regulatory obligation to recommend only suitable investments that are appropriate for their clients’ needs and objectives. Their employing brokerage firm has a legal and regulatory obligation to supervise the Financial Advisors’ sales practices and dealings with clients. To the extent any of these duties are breached, the customer may be entitled to a recovery of his or her investment losses.

 

Reasonable basis suitability requires that a recommended investment or investment strategy be suitable or appropriate for at least some investors. Reasonable basis suitability requires an advisor to conduct adequate due diligence so that he or she can determine the risks and rewards of the investment or investment strategy.

 

Quantitative suitability requires a brokerage firm or financial advisor with actual or de facto control over a customer’s account to have a reasonable basis for believing that a series of recommended transactions – even if suitable when viewed in isolation – is not excessive and unsuitable for the customer when taken together in light of the customer’s investment profile. No single test defines excessive activity, but factors such as the turnover rate, the cost-equity ratio, and the use of in-and-out trading in a customer’s account may provide a basis for a finding that a member or associated person has violated the quantitative suitability obligation.

 

Customer-specific suitability requires that a member or associated person have a reasonable basis to believe that the recommendation is suitable for a particular customer based on that customer’s investment profile. Among the criteria that a financial advisor must evaluate to satisfy his or her customer-specific suitability obligations include the investor’s age, tax status, time horizon, liquidity needs, and risk tolerance; a client’s other investments, financial situation and needs, investment objectives, and any other information disclosed by the customer should also be considered.

 

The Wolper Law Firm represents investors nationwide in securities litigation and arbitration on a contingency fee basis. Matt Wolper, the Managing Principal of the Wolper Law Firm, is a trial lawyer who has handled hundreds of securities cases during his career involving a wide range of products, strategies and securities. Prior to representing investors, he was a partner with a national law firm, where he represented some of the largest banks and brokerage firms in the world in securities matters. We can be reached at (800) 931-8452 or by email at mwolper@wolperlawfirm.com.