James Henry Dresselaers of Bethesda Maryland a stockbroker formerly registered with H. Beck Inc. is referenced in a customer initiated investment related arbitration claim where the customer sought $255,000.00 in damages founded on allegations that (1) Dresselaers made omissions to the customer concerning the risks of exchange traded funds and (2) Dresselaers gave the customer bad investment advice with regard to the exchange traded fund investments purchased for the customer’s account. Financial Industry Regulatory Authority (FINRA) Arbitration No. 18-00925 (Mar. 8, 2018).
FINRA Public Disclosure confirms that Dresselaers has been identified in four more customer initiated investment related disputes containing accusations of his violative conduct while employed with H. Beck Inc. Specifically, a customer initiated investment related arbitration claim regarding Dresselaers’ conduct was settled for $1,500,000.00 in damages based upon allegations that Dresselaers failed to make required disclosures to the customer with regard to the risks of the customer’s stock investments; and Dresselaers made investment recommendations to the customer that were not suitable given the customer’s circumstances for investing. FINRA Arbitration No. #15-03278 (June 8, 2017).
Customers then filed an investment related arbitration claim concerning Dresselaers’ conduct in which the customers requested $1,565,000.00 in damages supported by accusations that exchange traded fund and stock risks were concealed or otherwise unexplained; and the customers were placed in exchange traded fund and equities products that were not suitable for them. FINRA Arbitration No. 18-00626 (Feb. 15, 2018). Subsequently, a customer filed an investment related arbitration claim concerning Dresselaers’ activities where the customer sought $600,000.00 in damages founded on allegations of omissions being made concerning the customer’s investments; and inappropriate investment recommendations being made about the customer’s investments in closed-end mutual funds and exchange traded funds. FINRA Arbitration No. 18-00832 (Feb. 28, 2018).
Then, a customer filed an investment related arbitration claim regarding Dresselaers’ conduct in which the customer requested $5,000,000.00 in damages based upon accusations that Dresselaers gave the customer poor investment advice concerning the customer’s investments in common and preferred stock; private placement investments; and exchanged traded funds. FINRA Arbitration No. 18-00715 (Mar. 8, 2018).
FINRA Public Disclosure additionally reveals that Dresselaers has twice been subject of a regulatory action containing allegations of Dresselaers’ misconduct in the securities industry. Specifically, Dresselaers has been fined $10,000.00 and suspended from associating with any FINRA member in any capacity based upon consenting to findings that Dresselaers made unsuitable investment recommendations to investors. Letter of Acceptance Waiver and Consent No. 2016048675902 (Sept. 27, 2017).
According to the AWC, EB – a customer with a moderate tolerance for risk and no experience with investing – was advised by Dresselaers to place the customer’s assets in nontraditional exchange traded funds. The AWC stated that these products were not like typical exchange traded funds because the nontraditional exchange traded funds could generate several times the performance on a benchmark or index; produce returns based on the opposite of the index; and the funds are not supposed to be held for extended periods.
Dresselaers evidently steered EB towards investing over two million dollars, causing the customer to experience $851,175.00 in losses. Moreover, the customer was advised to purchase metals and mining investments, which caused the customer to have excess concentrations of speculative investments, creating substantial risks from the volatility in the metals and mining sector. Evidently, the customer incurred $264,618.00 in losses because of Dresselaers’ trading.
The AWC stated that Dresselaers neglected to have an adequate foundation to conclude that his recommendations were appropriate for the customer given the customer’s needs, financial situation, existing securities portfolio, and the customer’s plans for investing in no more than moderate risk investments on a long-term basis. FINRA found Dresselaers’ conduct violative of FINRA Rules 2010, 2111 and National Association of Securities Dealers (NASD) Rules 2110 and 2310.