David Lee Reynolds of Modesto California a stockbroker formerly registered with Principal Securities Inc. is the subject of a customer initiated investment related written complaint on March 6, 2019 where the customer requested $100,000.00 in damages founded on accusations that (1) Reynolds committed elder abuse (2) Reynolds placed the customer in investments including private placements and mutual funds which failed to be suitable for the customer and (3) Reynolds defrauded the customer through his activities while registered at Principal Securities Inc.
Financial Industry Regulatory Authority (FINRA) Public Disclosure reveals that Reynolds has been identified in two more customer initiated investment related disputes pertaining to allegations of Reynolds’ misconduct during the time that he was associated with Allstate Financial Services and Principal Securities Inc. In particular, on February 10, 2018, a customer initiated investment related complaint involving Reynolds’ conduct was settled for $250,000.00 in damages based upon accusations that during the time Reynolds was associated with Principal Securities Inc., he steered the customer towards placing monies in a private placement investment and then Reynolds neglected to return the customer’s principal.
Moreover, on February 26, 2018, a customer initiated investment related complaint concerning Reynolds’ activities was resolved for $66,654.25 in damages supported by allegations that Reynolds failed to repay the customer funds that were provided to him in reference to a private placement transaction executed while he was employed by Principal Securities.
FINRA Public Disclosure additionally confirms that Reynolds has been barred from associating with any FINRA member in any capacity supported by findings that Reynolds hindered a FINRA investigation into accusations of his misappropriation of customers’ funds. Letter of Acceptance Waiver and Consent No. 2017055823701 (Nov. 29, 2017).
According to the AWC, Reynolds was instructed by FINRA to produce information and documentation for the regulator under Rule 8210. Evidently, the investigation which FINRA launched into Reynolds had focused on the basis of Reynolds’ termination from Allstate Financial Services LLC. FINRA Public Disclosure reveals that Reynolds was discharged by Allstate founded on allegations that Reynolds refused to cooperate with the firm’s internal investigation into Reynolds’ misappropriation of funds belonging to customers of a prior securities broker dealer which appears to be Principal Securities.
The AWC stated that after counsel had been retained by Reynolds, FINRA was made aware that Reynolds turned down FINRA’s request and that Reynolds would not be cooperating at any point in FINRA’s investigation into his misappropriation of funds. FINRA found Reynolds’ activities in this respect to be violative of FINRA Rule 2010 and 8210.
