Securities Arbitration Lawyers BlogFormer VSR Financial Broker John H. Towers Under Investigation for 46 BrokerCheck Disclosures
Silver Law Group is investigating former Plano, Texas-based VSR Financial Services, Inc. (CRD# 14503) broker John H. Towers (CRD# 700221) due to an extraordinarily high amount of FINRA BrokerCheck disclosures alleging unsuitable recommendations and negligence.
According to John H. Towers FINRA BrokerCheck report, Towers has 46 misconduct disclosures, most of which are FINRA arbitrations. All the FINRA arbitrations allege that Towers recommended unsuitable investments and many allege overconcentration, and all but five of the disclosures have come in the last five years.
This is an extraordinary amount of FINRA BrokerCheck disclosures. While one or two complaints over a long period of time in the industry is not unheard of, the complaints Towers has amassed over a short period of time is concerning. Out of the 46, 42 are FINRA arbitrations and 35 of those have settled.
All the FINRA arbitrations allege that Towers recommended unsuitable investments and many allege overconcentration.
In 2013, FINRA suspended Towers for three months and fined him $25,000. According to the Acceptance, Waiver & Consent (“AWC”) entered into between FINRA and Towers, Towers recommended that a married couple invest in high risk private placements and real estate investment trusts (“REITs”) totaling over $6 million and 72% of their investments. The recommendations were completely outside of the couple’s risk profile, according to the AWC.
Two years later in 2015, FINRA permanently barred Towers for failing to respond to FINRA’s request for information. The permanent bar was levied as numerous FINRA arbitrations alleging millions of dollars in damages were being filed.
VSR Financial Services and Cetera Financial Group Background
VSR is part of Cetera Financial Group’s extensive network of independent broker dealers, many of which came to be owned by a common owner when Nicholas “Nick” Schorsch and RCS Capital Corp. went on an acquisition spree to acquire broker-dealers to sell his investment products. VSR is currently in the process of winding down and closing.
Some of Cetera’s firms, including VSR, are known for their sales of alternative investments such as non-traded REITs, BDCs, private placements, and promissory notes. Just this month, FINRA sanctioned VSR $400,000 for misconduct surrounding the sale of L-share Variable Annuities. In 2013, FINRA sanctioned VSR $550,000 for failing to supervise the sale of alternative investments and, consequently, overconcentrating customers’ accounts with these investments.
Contact Our Firm if You’ve Lost Money
Our lawyers are experienced and seasoned veterans when it comes to securities litigation, guiding hundreds of clients through the FINRA arbitration process and winning millions of dollars for them.
If you invested with John H. Towers and VSR Financial Services and have sustained losses, you may be entitled to recover some of your investment losses. Please contact Scott Silver of the Silver Law Group for a free consultation at ssilver@silverlaw.com or toll free at (800) 975-4345 to speak to an attorney to find out how we may be able to help you recover some of your investment losses. You owe us nothing unless we recover.