Before starting at Lincoln Financial Securities Corporation (CRD# 3870) in 2017, Razvi was registered with The O.N. Equity Sales Company (CRD# 2936), Park Avenue Securities LLC (CRD# 46173), NY Life Securities LLC (CRD# 5167), and Mutual of Omaha Investor Services, Inc. (CRD# 611). He had been in the industry since 1998. Razvi owned and did business as Higher Ground Financial Group in Maryland.
Imran Razvi Disclosures
Imran Razvi (Imran Nazir Razvi, Raz Razvi) has 5 disclosures on his publicly-available FINRA BrokerCheck record (CRD# 3042006), including 1 regulatory filing, 2 customer disputes, and 2 financial:
March, 2020: A regulatory disclosure sanctioned Razvi $5,000 and suspended him for six months. The allegations state “Without admitting or denying the findings, Razvi consented to the sanctions and to the entry of findings that he engaged in an outside business activity notwithstanding that his member firm denied his request to do so. The findings stated that Ravi sought approval to use a company he formed to refer investors to a purported real-estate investment fund. Ravi’s firm denied his request and notified him that he could not accept compensation or consideration for referrals to the fund. Contrary that denial, his company’s agents referred investors to the fund and in exchange for these referrals, the agents received commissions. The commissions the agents earned were paid to the company. Razvi, through his ownership of the company, received a portion of those commissions. Later, the fund filed a voluntary Chapter 11 bankruptcy petition. The United States District Court for the Southern District of Florida issued final judgements against, among others, the fund and its former owner. Those judgments required the fund and its owner to, among other things, disgorge their ill-gotten gains and also required the owner to pay a civil penalty.”
October, 2018: A customer dispute stated “Client alleges the RR recommended an unsuitable investment and failed to disclose the appropriate risks of this non-registered investment.” The claim was settled for $32,514.05.
April, 2018: A customer dispute stated “Client alleges the RR recommended an unsuitable investment and failed to disclose the appropriate risks of this non-registered investment.” $100,001 in damages were requested, and the claim settled for $67,485.95.
July, 2013: A financial disclosure states that a compromise was “satisfied/released”.
May, 2013: A financial disclosure states that a compromise was “satisfied/released”.
Allegation Of Selling Away
The allegation that caused FINRA to suspend Razvi involves an allegation that he referred clients to an unapproved real estate fund and received referral fees for doing so. The fund later declared bankruptcy and was ordered to pay a civil penalty and “disgorge their ill-gotten gains”.
The activity Razvi allegedly engaged in is known as selling away, which is potentially risky for clients. The alleged fact pattern detained in the disclosure is not uncommon: broker is denied approval to sell risky investments that will earn him high commissions, does it anyway, then the investment fails and investors lose their money.
Brokerage firms are responsible for supervising their representatives. Investors who incur losses from selling away may be able to recover their money through FINRA arbitration.
The Financial Industry Regulatory Authority’s (FINRA) Rules On Selling Away
FINRA Rule 3280 governs how brokers should handle any private securities transactions. Essentially, these rules govern when individual brokers are allowed to sell investments not approved by their member firm, and what stockbrokers must do to get firm approval to conduct such a transaction.
Rule 3280 puts an obligation on both brokers and brokerage firms. Ultimately, FINRA rules requires that brokers or advisors disclose any proposed “selling away” to the compliance department of their broker-dealer.
After a thorough, accurate disclosure is made, a brokerage firm then has the responsibility to review the proposed private securities transaction. Upon review, the member firm has two options either allow the transaction to go forward or prevent the broker from participating in the transaction.
If the firm denes an individual broker’s request to sell the product, then the broker cannot go forward with the deal. If a broker fails to make disclosure in the first place, of if a broker goes forward with a sell away after receiving disapproval from their member firm, that individual has violated the requirements of FINRA Rule 3280.
Contact Silver Law Group If You Have Investment Losses With Imran Razvi Or Lincoln Financial Securities
Silver Law Group is a nationally-recognized law firm representing investors around the country in cases of securities and investment fraud. The firm has helped investors recover losses caused by stockbroker misconduct, including selling away. Scott Silver, Silver Law Group’s managing partner, is the chairman of the Securities and Financial Fraud Group of the American Association of Justice. Contact Scott Silver today at (800) 975-4345 or at ssilver@silverlaw.com for a no-cost consultation.