FINRA Arbitration Awards $100,000 to Investor Over Unsuitable GWG L Bonds

Posted on June 5th, 2024 at 10:57 AM
FINRA Arbitration Awards $100,000 to Investor Over Unsuitable GWG L Bonds

From the desk of Jim Eccleston at Eccleston Law

In a recent FINRA arbitration, an investor was awarded close to $100,000 due to unsuitable investments in GWG L bonds purchased in 2018 and 2020.

According to InvestmentNews, the arbitrator emphasized the broker-dealer and financial advisor's failure to uphold their fiduciary duty to the client. Mahrle pointed to GWG's weak economic position in 2020 as a red flag that Greenberg Financial Group and advisor David Sherwood ignored.

The FINRA award is unique because it is “reasoned” and reflects a growing trend of arbitration awards being reasoned decisions in securities industry disputes.

InvestmentNews reports that expert testimony supported the unsuitability of GWG L bonds, leading the arbitrator to hold Greenberg Financial and Sherwood liable for the investor's damages. While punitive damages were denied due to lack of factual basis, the award underscores the importance of broker-dealers and advisors fulfilling their fiduciary obligations to clients.

 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.

Tags: eccleston, eccleston law, finra

Return to Archive

TESTIMONIALS

Previous
Next

I have the best legal firm in the country to defend me. Awesome job!

Cindy C.

LATEST NEWS AND ARTICLES

May 9, 2025
FINRA Suspends Former Wells Fargo Advisor Over Unauthorized Transfer in Elderly Client's Account

FINRA has fined and suspended former Wells Fargo financial advisor Jarrett Thomas after he executed a $50,000 transaction for an elderly client despite being informed that she was no longer capable of managing her finances.

May 8, 2025
All 50 States Now Aligned on Annuity Sales Standards

The annuity industry officially has secured uniformity in sales regulations across all 50 states.

May 7, 2025
Jury Finds Investment Advisor Liable for Failing to Disclose Annuity Commissions

A federal jury in Massachusetts has found investment adviser Jeffrey Cutter and his firm, Cutter Financial Group, liable for violating federal securities law by failing to disclose significant upfront commissions and conflicts of interest related to an annuity replacement scheme.