On November 7, 2014 Essex Securities was fined $20,000 and ordered to pay approximately $6,000 in restitution to their customers for engaging in a pattern of unsuitable mutual fund switching in the accounts of seven customers.
According to the Financial Industry Regulatory Authority (FINRA) Essex Securities, through one of their brokers, switched mutual funds in seven of their customer’s accounts without having reasonable grounds for believing the transactions were suitable to these customers.
Specifically, on at least 29 occasions Essex Securities and their broker recommended that customers sell mutual funds within only one to thirteen months after buying them. Essex Securities earned around $60,000 on commissions for these sales and the individual broker at Essex Securities eared around $54,000.
Under FINRA rules, broker-dealer firms have a duty to supervise their brokers and to ensure that these brokers are complying with and not violating federal securities laws and FINRA Rules. Failure to supervise one’s brokers can lead to liability on the part of the broker-dealer firm.
Essex Securities is a Massachusetts based broker-dealer firm with 44 registered representatives nationwide. Essex Securities was formed in 1994 and their main office location remained in Topsfield, Massachusetts. Essex Securities has offices in all fifty states is registered with both the SEC and FINRA.
If you or someone you know has lost money investing with Essex Securities or one of their brokers, you may be entitled to compensation for your losses. Our firm prosecutes cases on behalf of investors nationwide on a contingency fee basis. Call now to speak directly to an attorney and discuss the merits of your case at no cost to you. Consultations are always free, but time to file these claims with FINRA is limited, so do not delay. Call now.