Alan Mark Mason of New York, New York, a stockbroker registered with WestPark Capital Inc., has been fined $5,000.00 and suspended for two months from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity because Mason made the unsuitable investment recommendations in GWG Class L Bonds during the time that he was associated with WestPark Capital Inc. Letter of Acceptance, Waiver, and Consent No. 2021070498102 (May 31, 2024).
According to the AWC, In July 2020, Mason recommended that the customer invest in Class L Bonds offered by GWG Holdings Inc. GWG Holdings is a publicly traded company that, prior to 2018, focused on purchasing life insurance contracts on the secondary market. GWG then shifted its focus to providing liquidity to holders of alternative investments.
FINRA stated that GWG had a history of net losses and did not generate enough cash flows for carrying out operations. GWG offered L Bonds to investors, which involved a high degree of risk and were illiquid. The regulator indicated that these bonds were only suitable for individuals with substantial financial resources and no need for liquidity.
Despite the high risks associated with L Bonds, Mason advised the customer to invest $50,000.00 in GWG’s Class L Bonds in February 2020. Later, in July 2020, he recommended that she invest another $50,000.00 in the same bonds. Consequently, the customer’s total investment in Class L Bonds amounted to over 20 percent of her liquid net worth. This was inconsistent with her moderate investment objectives risk tolerance, which focused on growth and income rather than speculation. Mason earned a commission from the July 2020 recommendation.
FINRA’s investigation concluded that Mason’s recommendation was not in the best interest of the customer, considering her investment profile. By advising her to concentrate a significant portion of her liquid net worth in such a high-risk investment, Mason violated FINRA Rule 2010 and Securities Exchange Act of 1934 Rule 15l-1(a)(1).
FINRA Public Disclosure shows that Mason is referenced in five customer initiated investment related disputes concerning Mason’s conduct while associated with securities broker dealers. On November 27, 2000, a customer initiated investment related complaint involving Mason’s conduct was settled for $50,000.00 in damages based upon allegations that Mason engaged in unauthorized trading in Home Depot, AOL, Gateway, Tyco, STM, Amgen, Excites, Broad Vision, and Lam Research during the time that Mason was associated with First Union Securities Inc.
On October 17, 2002, a customer initiated investment related FINRA securities arbitration claim involving Mason’s conduct was settled for $30,000.00 in damages based upon allegations that Mason overly concentrated the customer’s portfolio with speculative securities during the time that Mason was associated with Gruntal Co. LLC FINRA Arbitration No. NYSE #2002-010176.
Mason was also referenced in a complaint that was settled on May 12, 2009, for $25,000.00 in damages based upon allegations that Mason made unsuitable recommendations and engaged in unauthorized trading in mutual funds when Mason was associated with Gunnallen Financial Inc.
Mason was also referenced in a securities arbitration claim in which the customer received $33,200.00 in damages based upon allegations that Mason failed to perform due diligence and made unsuitable recommendations in GWG L Bonds when Mason was associated with Westpark Capital Inc. FINRA Arbitration No. 22-01262 (June 6, 2022).
On August 16, 2022, a customer filed a securities arbitration claim involving Mason’s conduct in which the customer requested $5,000,000.00 in damages based upon allegations that Mason breached his fiduciary duties to the customer and made the unsuitable investment recommendation of GWG Class L bonds during the time that Mason was associated with Westpark Capital Inc. FINRA Arbitration No. 22-01793.
Mason has been associated with Bradley Woods Co. Ltd. in New York, New York since March 13, 2023. Mason was associated with Westpark Capital Inc. in New York, New York from March 23, 2018, to March 14, 2023.
