FINRA Settles With Coastal Equities Over Improper GPB Private Placement Sales

Posted on January 6th, 2023 at 12:54 PM
FINRA Settles With Coastal Equities Over Improper GPB Private Placement Sales

From the Desk of Jim Eccleston at Eccleston Law.

The Financial Industry Regulatory Authority (FINRA) has agreed to a $418,000 settlement with Coastal Equities over sales in 2018 of GPB private placements.

FINRA’s settlement, however, accused the firm of failing to supervise one of its advisors, classified as Representative A in the matter. Representative A “was falsifying documents regarding customers’ financial status, for example by recording false increases in the net worth and liquid net worth of customers”, to initiate additional GPB sales, according to FINRA. According to FINRA, the firm failed to supervise the advisor between 2014 and 2018 while Coastal Equities consented to the penalty without admitting or denying any of FINRA’s investigatory findings.

Coastal Equities also negligently failed to inform investors that GPB did not submit its required filings, including audited financial statements, with the Securities and Exchange Commission (SEC) in 2018, according to FINRA. While advisors may only typically sell private placements to accredited investors, or investors with more than $1 million in net worth, Representative A circumvented firm rules that limited client allotments to alternative investments to 35% in nearly two dozen transactions by inflating their liquid net worth, according to FINRA. FINRA’s penalty included a $150,000 fine as well as restitution of $268,000.

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

Tags: eccleston, eccleston law, advisors, law, finra

Return to Archive



I learned two important things working with Eccleston Law. First, I made a friend and ally with Jim and Steph for life. Secondly, and this is a crucial life lesson - if you need counsel, then seek out the very best. Jim was referred to me by a most trusted source. I've never had to hire an attorney for anything. Now, I know the value of hiring an important partner. Meticulous, thorough and detailed in preparation is the best way to describe Jim. Brilliant too, I might add. Bottom line, I would highly highly recommend Jim and Stephany for your legal needs. One of the best life decisions I've ever made.

Howard S.


March 24, 2023
Heartland Bank & Trust Co. Agrees to $9 Million Settlement For Allegedly Aiding and Abetting a Ponzi Scheme

The Securities and Exchange Commission (SEC) has agreed to a $9 million settlement
with Heartland Bank & Trust Co. over the bank’s alleged role in aiding and abetting a $75
million Ponzi scheme.

March 23, 2023
Morgan Stanley Obtains TRO Against Pennsylvania LPL Advisor Over Inherited Accounts and Misrepresentations

A federal judge has awarded Morgan Stanley a temporary restraining order (TRO)
against a Pennsylvania-based advisor who recently departed for LPL Financial.

March 22, 2023
Sanford Bernstein & Co. and Alliance Bernstein Face FINRA Arbitration Claim Over Options Advantage Strategy

Sanford Bernstein & Co. and Alliance Bernstein (Bernstein) are facing what could be the first of several Financial Industry Regulatory Authority (FINRA) arbitration claims related to its Options Advantage Strategy.