- April 5, 2023
- Janssen Partners LLC
Peter Janssen (CRD#: 43940) is a registered Broker at Janssen Partners, Inc., in Fairfield, IA.
He entered the securities industry in 2011 and previously worked for Katalyst Securities, LLC; and Aegis Capital Corp.
Current And Past Allegations Of Conduct Leading To Investment Loss
According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), in January 2023, a customer dispute was filed against Peter Janssen. The FINRA sanction states, “Claimant alleges terms of the Mega Blockchain private placement were misrepresented. Claimant alleges she was unsuitable for the investment. On or about December 28, 2017, Claimant invested $94,930.40 into the Mega Blockchain offering.” Damages of $94,930 are requested. The customer dispute is pending.
In addition, Peter Janssen has been the subject of three customer complaints, including the following:
- August 2021 — “The customer alleged that a private placement which he purchased was unsuitable.” The customer dispute was settled for $35,000.
- November 2019 — “Early Dec 2017 to Dec 29 2017, Peter Janssen communicated with Claimant about investment in Mega Blockchain, a venture opportunity into the crypto currency market. Claimant had been communicating with Peter Janssen for several months prior to Dec 2017 on other opportunities, which Claimant declined. Claimant executed documents representing to Mega Blockchain and Katalyst Securities that he was an accredited investor as defined under the Federal Securities laws, he had a net worth of $1.5 million, liquid assets of $1 million, his investment objective was speculation. Claimant and Peter Janssen were communicating directly with each other about the details of the Offering. Claimant initially chose to invest $100,000 and reduced his investment to $50,001 on Dec 29, 2017.” The customer dispute was settled for $50,000.
- November 2019 — “Early Dec 2017 to Dec 29 2017, Peter Janssen communicated with Claimant about investment in Mega Blockchain, a venture opportunity into the crypto currency market. Claimant executed documents representing to Mega Blockchain and Katalyst Securities that he was an accredited investor as defined under the Federal Securities laws, he had a net worth of over $5 million, his investment objective was speculation. Claimant and Peter Janssen were directly communicating with each about the details of the Offering. Claiman invested $30,000 on Dec 29, 2017.” The customer dispute was settled for $30,000.
For a copy of Peter Janssen’s FINRA BrokerCheck, click here.
We Help Investors Recover Investment Losses
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.
Private placements is a broad term that describes securities that are not offered for sale through a public exchange. These can include promissory notes, private equity offerings, small, start-up businesses, etc. Private Placements are issued under Regulation D under the Securities Act of 1933. Regulation D provides exemptions from the more rigorous Securities and Exchange Commission (SEC) registration requirements and allows companies to offer and sell securities without extensive disclosures.
The Securities Exchange Commission, federal courts, and FINRA have all found that brokerage firms have a duty to conduct a reasonable investigation concerning the private placements issuer’s representations concerning the security. A brokerage’s firm’s due diligence obligation also stems from suitability obligations requiring the broker to have reasonable grounds to believe that a recommendation to purchase, sell or exchange a security is suitable for the customer.
In order to meet the due diligence obligation, the brokerage firm and/or financial advisor must make reasonable efforts to gather and analyze information about the private placement, the issuer and its management, the business prospects of the issuer, the assets held by or to be acquired by the issuer, the claims being made by the issuer in the offering materials, and the intended use of proceeds of the offering. The failure to determine this and other material information would necessarily preclude a financial advisor from disclosing to a customer the material aspects of a transaction.
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:
- Other investments
- Financial situation and needs
- Tax status
- Investment objectives
- Time horizon
- Liquidity needs
- Risk tolerance
- Any other information disclosed by the customer
The Wolper Law Firm, P.A. represents investors nationwide in securities litigation and arbitration on a contingency fee basis. Matt Wolper, the Managing Principal of the Wolper Law Firm, P.A., 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 firstname.lastname@example.org.