FINRA Suspends Former Raymond James Advisor Over UIT Sales

Posted on February 18th, 2022 at 1:03 PM
FINRA Suspends Former Raymond James Advisor Over UIT Sales

From the Desk of Jim Eccleston at Eccleston Law:

The Financial Industry Regulatory Authority (FINRA) has suspended a former Raymond James advisor for three months and imposed a $5,000 fine over unsuitable sales of Unit Investment Trusts (UITs).


The St. Petersburg-based advisor, Lynn Faust, allegedly recommended at least 4,500 “early” rollovers of UITs prior to their maturity date between 2013 and 2017, according to FINRA. In 2,200 cases, FINRA alleges that Faust convinced clients to exchange one UIT for another with similar investment objectives. UITs typically feature sales charges of around 3.95%. However, an early rollover likely would accrue an additional sales charge of 2.95%, according to FINRA. Faust was ranked #1 on Forbes’ list of the country’s Top Women Advisors and #4 in the state overseeing $265 million in assets prior to her termination.


Raymond James has fired several advisors in recent months over unsuitable UIT sales. In fact, the firm recently agreed to a $15 million settlement with the Securities and Exchange Commission (SEC), which included $12 million in restitution pertaining to excessive advisory fees and improper UIT charges. According to BrokerCheck, Faust entered the industry in 1981 with Waddell & Reed prior to joining Raymond James in 1988.
Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

 
 

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