FINRA Suspends Former Investment Planners, Inc. Broker, James Parrelly, For Allegedly Executing Discretionary Transactions
James Parrelly (CRD # 728368) was a Financial Advisor at Investment Planners, Inc. in Dearborn, MI. James Parrelly was in the securities industry from 1981 to 2020 and previously worked at nine different brokerage firms, one of which has since been expelled from the industry by FINRA.
According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), on May 5, 2020, FINRA sanctioned James Parrelly, suspending him for a period of 15 business days, fining him $5,000.
According to the FINRA sanction, “Without admitting or denying the findings, Parrelly consented to the sanctions and to the entry of findings that he executed discretionary transactions in the securities account of a customer pursuant to the customer’s prior verbal authorization, but without written authorization from the customer or written approval from his member firm.”
For a copy of the FINRA sanction, click https://www.finra.org/sites/default/files/fda_documents/2019062166301%20James%20A.%20Parrelly%20CRD%20728368%20AWC%20va%20%282020-1591316369369%29.pdf
The following month, in June 2020, John Parrelly voluntarily resigned from Investment Planners, Inc.
In addition, James Parrelly has been the subject of eight customer complaints during his career, alleging sales practice misconduct. The complaints allege the following:
• April 2019—”Statement of Claim alleges churning, negligence of duty and unsuitable investments.” The Alleged damages are $500,000 and the matter remains pending.
• September 2010—”CLIENT ALLEGED UNAUTHORIZED, UNSUITABLE AND DISCRETIONARY TRADING, CHURNING AND EXCESSIVE COMMISSIONS. 10/06 – 12/09.” The matter settled for $90,000.00.
• April 2003—”UNSUITABLE, HIGH RISK, SPECULATIVE TRADING, BREACH OF CONTRACT, FRAUD, PROMISSORY ESTOPPEL, NEGLIGENCE, MALPRACTICE, BREACH OF FUDICIARY DUTY, BREACH OF MICHIGAN SECURITIES LAW.” The matter settled for $150,000.00.
• June 1995—”BREACH OF FIDUCIARY DUTY, MISREPRESENTATION. RELIFE ASKED: RESTITUTION OF THE ORIGINAL PURCHASE AMOUNT OF $100,000.00, COMPENSATORY DAMAGES $10,000.00 EXEMPLARY DAMAGES OF $10,000.00.” The matter settled for $100,000.00.
• May 1995—”BREACH OF FIDUCIARY DUTY, ACCT RELATED; FAILURE TO SUPERVISE, CHURNING, MISREPRESENTATION. RELIEF ASKED: ACTUAL/COMPENSATORY $83,754.00 PLUS ACT/COMP $30,000.00 PLUS. PUNITIVE/EXEMPLARY $200,000.00, PLUS ACT/COMP $4,441.00 PLUS PUNITIVE/EXEMPLARY $10,000.00 EACH ASKED JOINTLY/SEVERALLY.” The matter settled for $58,000.00.
• April 1995—”SUITABILITY, MISREPRESENTATION, UNAUTHORIZED TRADING, CHURNING. RELIEF ASKED: ACTUAL AND COMPENSATORY $120,000.00 JOINTLY AND SEVERALLY, PUNITIVE/EXEMPLARY $20,000 JOINTLY/SEVERALLY.” The matter settled for $27,000.00.
• June 1993—”BREACH OF FIDUCIARY DT; ACCOUNT RELATED-BRCH OF CONTRACT; MISREPRESENTATION. TOTAL ACTUAL/COMPENSATORY DAMAGES, ASKED AMOUNT $1,185,154.00 JOINTLY AND SEVERALLY; TREBLE DAMAGES, ASKED AMOUNT $3,555,465.00 JOINTLY AND’ SEVERALLY.” The matter settled for $290,000.00.
• January 1986—” PURCHASE OF SECURITIES WERE UNSUITABLE, RELIEF REQUEST $86,800.00.” The matter settled for $86,800.00
For a copy of Paul James Parrelly’s CRD, click https://brokercheck.finra.org/individual/summary/728368#disclosuresSection
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.
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