Rhett Bedwell, Former Investment Advisor at LPL Financial, LLC, Indefinitely Barred by FINRA for Refusing to Provide Information Requested as Part of an Investigation
Rhett Bedwell (CRD#: 5664392) was an Investment Advisor at LPL Financial, LLC in Rogers, AR. He entered the securities industry in 2009 and previously worked for Arvest Wealth Management; Investment Professionals, Inc.; Wells Fargo Advisors, LLC; and Edward Jones.
According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), in March 2021, FINRA sanctioned Rhett Bedwell, barring him indefinitely from acting as a broker or otherwise associating with a broker-dealer firm, effective March 2, 2021. The FINRA sanction states, “Without admitting or denying the findings, Bedwell consented to the sanction and to the entry of findings that he refused to produce information and documents requested by FINRA during the course of its review of an amended Form U5 filed by his former member firm. The findings stated that the Form U5 disclosed that Bedwell had been identified in a pending customer arbitration alleging that he moved a client’s IRA to a different administrator and used forged documentation to invest the claimant’s money in a Ponzi scheme. Although Bedwell provided some of the information and documents requested by FINRA, he failed to respond to certain of the requests.”
For a copy of the FINRA sanction, click here.
In addition, Rhett Bedwell has been the subject of several customer complaints, including one that remains pending:
● August 2020 “Claimant alleges that in 2019 representative moved clients IRA to a different administrator and used forged documentation to invest claimant’s money in a Ponzi scheme.” The customer dispute remains pending.
● January 2019 A judgment/lien of $1,471.35 was levied against Rhett Bedwell.
● December 2012 “ON SEPTEMBER 21, 2012 CLIENT CLAIMS THE PURCHASED ANNUITY CONTRACT IS NOT WHAT SHE EXPECTED AND CLAIMS SHE WAS TOLD THE AMOUNT SHE INVESTED WOULD NOT DECREASE. SHE HAS LEARNED THERE IS AN INCOME BENEFIT THAT WILL NOT GO DECREASE; HOWEVER, HER PRINCIPAL CAN DECREASE. CLIENT ALSO CLAIMS SHE DID NOT KNOW THE FEES WERE SO HIGH. CLIENT STATES SHE WANTED A SAFE INVESTMENT WITH NO RISK AND THE PURCHASED ANNUITY DOES NOT PROVIDE THAT. CLIENT WANTS HER INVESTED MONEY OUT OF THE ANNUITY SHE PURCHASED.” The customer dispute was denied.
For a copy of Rhett Bedwell’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.
FINRA has defined the standards in which investment recommendations made by brokerage firms and registered financial advisors are evaluated. The FINRA suitability rule focuses on three fundamental concepts: (1) reasonable basis suitability, (2) quantitative suitability, and (3) customer-specific suitability.
● 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, other investments, financial situation and needs, tax status, and investment objectives. Other considerations include the customer’s time horizon, liquidity needs, risk tolerance, and any other information disclosed by the customer.
Failure by a financial advisor to adhere to these requirements is evidence of negligence or, worse, investment fraud. If you as the investor can establish, at a minimum, negligent misconduct, you may be entitled to recover your investment losses.
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.