• November 16, 2023
• Somerset Securities

Thomas Burgess Hamlin (CRD#: 2208505) is a registered broker and investment advisor at Somerset Securities, Inc. in Portland, OR.

Broker’s Background

He entered the securities industry in 1992 and previously worked for Raymond James Financial Services Advisors, Inc.; Prudential Securities Incorporated; Spelman & Co.,Inc.; and Advantage Capital Corporation.

Current and Past Allegations of Conduct Leading to Investment Loss

According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), in October 2023, Thomas Hamlin became the subject of a customer dispute alleging, “unsuitable recommendation to purchase iCap Equities private placement. iCap Equities filed for bankruptcy on 9/12/2023.” The damage amount requested is $285,000 and the customer dispute is still pending.

In addition, Thomas Hamlin has been the subject of two other disclosures, which include the following:

• September 2023—“ Alleged unsuitable recommendation to purchase iCap Equites private placement. iCap Equities filed for bankruptcy on 9/12/2023.” The damage amount requested is $355,000 and the customer dispute is still pending.
• November 2012—“FAILURE TO DISCLOSE OUTSIDE BUSINESS ACTIVITY.” Raymond James Financial Services discharged Thomas Hamlin.

 

For a copy of Thomas Hamlin’s FINRA BrokerCheck, click here.

 

The iCap securities are in distress.  In March 2023, the CEO of iCap, informed investors that “it appears that interest rates are on track to continue rising which means things will likely worsen in the near term.”  The CEO further advised that “the current situation has impacted the real estate portfolio that iCap manages and therefore our ability to return capital to investors under the time frame originally proscribed in our disclosure documents.  We are writing to inform you that at this time we are not able to continue making monthly interest payments.”  Several months later, on September 29, 2023, iCap filed for bankruptcy.  According to the bankruptcy filing, iCap Enterprises, through its various funds, has less than $100 million in assets and up to $500 million in liabilities.  It is also reported that iCap has up to 5,000 individual creditors.

 

Investors who invested in the iCap family of funds through brokerage firms or financial professionals have the ability to bring a FINRA arbitration claim to recover their losses.  FINRA Notice to Members 10-22 provides specific requirements that brokerages and financial professionals must undertake when conducting due diligence on privately held securities, before recommending them to investors.  Moreover, the FINRA suitability rule requires that brokerages and financial professionals make both reasonable basis and customer specific suitability determinations prior to recommending securities to customers.  These due diligence obligations are absolute but are often overlooked by brokerage firms because they don’t have the resources or infrastructure to effectively conduct due diligence.  It is often passed along to third-parties, who fail to meet the exacting standards of FINRA Notice to Members 10-22.

 

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.

 

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.