- August 17, 2021
- Ausdal Financial Partners
David Geake (CRD#: 3088891) is a dually registered Broker and Investment Advisor at American Trust Investment Services, Inc. in Chicago, IL. He entered the securities industry in 1998 and previously worked for American Trust Investment Services Advisory; Ausdal Financial Partners, Inc.; Madison Avenue Securities, LLC; American General Securities Incorporated; and Franklin Financial Services Corporation.
According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), in May 2021, a customer dispute was filed against David Geake, alleging “Unsuitable investments.” The complaint remains pending.
In addition, David Geake has been the subject of 10 customer complaints, including two that remain pending, including the following:
● May 2021–”Unsuitable investments, breach of fiduciary duties, lack of supervision.” The customer dispute remains pending.
● March 2021–”Suitability.” Damages of $500,000 are requested, and the customer dispute remains pending.
● August 2020–”Failure to supervise. In 2016 the individual pledged $2.5 million of collateral for MrktServ in exchange for shares in the company. Then in 2017, individual loaned MrktServ, Inc.$200,000 for larger equity ownership in the company.” The customer dispute was settled for $560,000.
● April 2020–”Claimants allege failure to conduct Due Diligence on several points, unsuitable recommendation, overconcentration, misrpresentations and omissions in violation of FINRA regulations in the sale of Alternative Investments.” The customer dispute was settled for $20,000.
● October 2019–”Client alleges unsuitable recommendations in illiquid investments in 2014 while a representative of Madison Securities, Inc. prior to the rep joining American Trust Investment Services, Inc.. The client also alleges that funds were deposited to the joint account and not invested, which occurred with the client was with Ausdal, also prior to joining American Trust Investment Services.” The customer dispute was denied.
● September 2018–”Engaging in an unreported private security transaction.” David Geake was permitted to resign from Ausdal Financial Partners, Inc.
● March 2018–”Customer alleges unsuitable investments related to recommendation to move out of 401(k) to pay off debt, and invest in income generating products based on a financial plan she established with her rep in 2016. Transactions occurred in November 2016.” The customer dispute was closed with no action.
● July 2017–”[customer] purchased multiple products through David Geake in 2015 while he was registered with Madison Avenue Securities. The client alleges the products were not suitable for her, and alleges issues with risk tolerance, suitability, concentration and liquidity.” The customer dispute was closed with no action.
● June 2017–”Alleged activity occurred prior to Mr. Geake joining Ausdal Financial Partners. However, the customer subsequently transferred her accounts to Ausdal. Customer alleges securities fraud, misrepresentation, tax losses and breach of fiduciary duty based on the conduct of former Madison Avenue Securities brokers [Redacted], David Geake, and [Redacted]. Alleged activity occurred in or around June 2015.” The customer dispute was settled for $40,000.
● September 2012–”POA ALLEGES THE REIT HER MOTHER PURCHASED WAS UNSUITABLE.” The customer dispute was denied.
● March 2011–”ON 10/18/2010 THE FIRM RECEIVED A LETTER FROM THE CUSTOMERS’ ATTORNEY ALLEGING OVER CONCENTRATION IN REITS AND A DEMAND TO RETURN THE TOTAL AMOUNT INVESTED IN THE REITS TO THE CUSTOMERS IN EXCHANGE FOR THE REITS. ON 03/16/2011 CLAIMANTS FILED AN ARBITRATION ALLEGING MISREPRESENTATION AND SUITABILITY ISSUES WITH THE PURCHASE OF THREE REITS.” The customer dispute was settled for $140,000.
For a copy of David Geake’s FINRA BrokerCheck, click here.
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 agee, 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 email@example.com.