Montana financial advisor barred from securities activity for multiple FINRA violations
In a ruling that came in August 2015, the Financial Industry Regulatory Authority (FINRA) permanently barred Barry G. Hartman, formerly of FSC Securities Corporation in Missoula, MT, for allegedly engaging in a practice known in the industry as selling away.
While Hartman was registered with FSC, he also managed his securities business through Rocky Mountain Financial LLC. Multiple prior clients are alleging that Hartman recommended outside investments without the necessary approval from his registered firm.
There are multiple additional allegations in the FINRA report regarding Hartman’s failure to notify FSC about various potentially problematic relationships, including serving on a Board of Directors for a private company, referring clients directly to the outside business to complete their investments, and investing personal funds in the outside business. In each of these complaints, he allegedly failed to comply with his former firm’s stated policy that requires pre-approval for such securities transactions.
Other recent client complaints have also been lodged against Hartman for negligence, breach of fiduciary duty and fraud. Some of these charges are still pending.
Doing business with outside private companies and businesses without prior consent of the FINRA registered broker company is known as a practice called “selling away.” This practice violates established security regulations and is often motivated by brokers’ desire to earn commission on an investment, even if it is not approved by the associated firm.
Further, selling away allows the broker to avoid having to share commission with the associated firm. These types of schemes are dangerous for investors because they are not regulated and can easily, and often do, turn into a situation where the broker has the opportunity to commit theft and securities fraud. In many cases, the client ends up losing a large portion of their investment.
Silver Law Firm represents individuals who find that they have been taken advantage of by unlawful or unethical investment broker practices such as selling away, churning, Ponzi schemes, unauthorized trading and securities fraud.
The legal team at Silver Law Group has more than twenty years of experience and a track record of success, helping victims recover tens of millions of dollars in lost investments. We operate on a contingency-fee basis, meaning that we only get paid if we recover lost funds for our clients. We hold brokers accountable who have mistreated their clients so that they cannot do further damage.
If you feel that your investment broker or financial advisor has misused your funds, misrepresented you, or that he/she does not have your best financial interest in mind, call Silver Law Firm at 1-800-975-4345 today for a free case review with an experience securities arbitration attorney.