- January 30, 2021
- Merrill Lynch
Keith Simmons (CRD#: 730619) is a Financial Advisor at Merrill Lynch, Pierce, Fenner & Smith, Inc. He entered the securities industry in 1981; he has never worked for any other firm.
According to publicly available records released by the Financial Industry Regulatory Authority (FINRA), Keith Simmons has two pending customer disputes related to unsuitable investment recommendations. The first was filed on May 29, 2020, and damages of $8,000,000 are sought; the second was filed October 30, 2020, and damages of $1,100,000 are sought.
In addition, there are two previously settled complaints reflected on his CRD:
• December 2009 – “THE CUSTOMER ALLEGES MISREPRESENTATION REGARDING THE LIQUIDITY AND RISK OF AUCTION RATE SECURITIES IN JUNE 2008.” The complaint was settled for $300,000, the exact amount sought in damages.
• October 1997 – “CUSTOMER ALLEGED THAT MR. SIMMONS OVERSOLD SHARES OF ALPINE LACE BRANDS INC. WITHOUT HIS AUTHORIZATION. CUSTOMER REQUESTS THAT THESE SHARES BE REINSTATED IN HIS ACCOUNT.” The complaint was settled by the firm for $9,000.
For a copy of Keith Simmons’ CRD, 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:
• Other investments
• Financial situation and needs
• Tax status
• Investment objectives
• Time horizon
• Liquidity needs
• Risk tolerance
• 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 recovery 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.