UBS terminated Smith, based out of Aventura, Florida, in October 2015 after he failed to disclose to the firm that he was named trustee for the trust of an unrelated client on two occasions.
In May 2016, FINRA barred Smith from the selling securities after Smith failed to respond to a FINRA request for information.
UBS employed Smith in its Aventura, Florida-based branch from March 2011 to November 2015. In the two years prior to working at UBS, Smith was employed by Morgan Stanley Smith Barney (CRD# 149777). Smith had been in the industry for 48 years, working at seven brokerage firms in total, according to his FINRA BrokerCheck report.
Seemingly a minor, mundane issue, a broker serving as trustee of a trust for an individual who is not related to the broker is a serious transgression. It is a conflict of interest that can affect how a broker manages the trust assets: the broker, serving in financial advisor capacity as well as a trustee, might favor investments with higher commissions.
Many brokerage firms disallow the practice of serving as trustee without disclosing it to the employing firm. Some brokerage firms only allow their brokers to serve as trustees for trusts of the brokers’ family members. This is because of the self-dealing, conflict-of-interest aspect of the trustee/broker relationship.
Be wary of allowing your broker the privilege of serving as trustee and broker of your trust. Be even more wary of the broker that makes the unsolicited suggestion of such an arrangement. If you currently have such an arrangement, check your statements and consult your broker/trustee to make sure the trust has been managed properly.
If you have lost money or your investments have lost value while your broker has served in the dual capacity of broker/trustee, you may be able to recover your lost investments through FINRA arbitration. FINRA arbitration is a fast, efficient to recover money lost investing by broker misconduct and other forms of securities fraud.
If you have invested with Michael R. Smith and UBS Financial Services, our law firm may be able to recover some or all of your lost investment.
Silver Law Group represents the interests of investors who have been the victims of investment fraud. If you have questions about your legal rights, please contact Scott Silver of the Silver Law Group for a free consultation at ssilver@silverlaw.com or toll free at (800) 975-4345.