Suitability Complaints Pending Against Royal Alliance Associates Broker/Advisor Ryan T. Fleming
Ryan T. Fleming (CRD#: 4378425) is a dually registered Broker and Investment Advisor at Royal Alliance Associates, Inc. in Bellevue, WA. He entered the securities industry in 2001 and previously worked for Hornor, Townsend & Kent, LLC; and Advisory Resource Group, LLC.
According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), in April 2021, a customer dispute was filed against Ryan T. Fleming. The allegation states, “According to Hornor Townsend Kent’s disclosure, the client alleged that certain REIT investments recommended to them were not suitable, and resulted in losses.”
Non-traded REITs do not trade a public securities exchange. For this reason, non-traded REITs can be illiquid, meaning investors may be unable to sell their investments on demand. Typically, the commissions generated on non-traded REITs are higher than industry norm and may be subject to extreme volatility due to associated risk factors. Non-traded REITs are only suitable for investors with a long term investment horizon who are willing to accept higher levels of risk in their investments.
In addition, Ryan T. Fleming has been the subject of one additional customer complaint, including the following:
● March 2021–”Arbitration Claim alleging that Registered Representative recommended unsuitable investments for client’s IRA portfolios. It alleges breach of fiduciary duty and negligence, and request rescission, compensatory damages, lost opportunity costs, unspecified punitive damages, interest, costs and attorneys’ fees.” Damages of $100,000 are requested, and the customer dispute is currently pending.
For a copy of Ryan T. Fleming’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.
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