Fitapelli Kurta is investigating customer complaints related to the sale of Exchange Traded Funds, or ETFs, by Investors Capital Corp. Investors Capital Corp. is a member of the Financial Industry Regulatory Authority, or FINRA. The firm is based in Lynnfield, MA and operated from approximately 325 branch offices nationwide.
On March 7, 2014, Investors Capital Corp. consented to a FINRA fine of $100,000 and censure related to its sale of Exchange Traded Funds, or ETFs. Exchange Traded Funds are traded on stock exchanges like stocks and track an indexes, commodities or specific sectors. From June 2009 through April 2011, Investors Capital Corp. failed to establish and enforce a supervisory system for the sale of ETFs. According to FINRA, Investors Capital Corp., “had no procedures directly concerning the sale of ETFs.” Having supervisory systems in place for the sale of Exchange Traded Funds, or ETFs, is critical to ensure that customer’s interest and well being are protected. Specifically, these procedures are necessary to detect red flags and to deter fraud.
Unfortunately for Investors Capital Corp., the March 2014 FINRA complaint is not an isolated incident. Investors Capital Corp. has been the subject of a number of other regulatory complaints related to its failure to supervise its brokers. In June 2011, Investors Capital Corp. was fined $200,000 and censured for failing to establish a supervisory system regarding the sale of collateralized mortgage obligations to customers. Again in October 2011, the firm was ordered to pay over $400,000 for selling private placement offerings without having a reasonable supervisory system in place. Lastly, the Investors Capital Corp. has 18 other regulatory events and 13 disclosed customer arbitration awards on its FINRA BrokerCheck report.
If you or someone you know lost money investing in ETFs with Investors Capital, contact us today for a free consultation. The law limits the time you have to recover money – do not delay.