Rafael Scott Klein (also known as Rafe Klein), of Westport, Connecticut, a stockbroker registered with David Lerner Associates Inc., is under a Financial Industry Regulatory Authority (FINRA) investigation. Public Disclosure shows that on March 18, 2024, the regulator issued a Wells Notice recommending disciplinary action against the stockbroker. Klein potentially violated FINRA Rules 2111 and 2010 by m making the unsuitable investment recommendation of certain investments including the Energy 11, L.P., and the Energy 12, L.P. without a reasonable basis, and for maintaining inaccurate customer profiles, in violation of FINRA Rules 4511 and 2010.
FINRA Public Disclosure shows that Klein has been referenced in five customer initiated investment related disputes during his time in the securities industry. On May 18, 2021, a customer initiated a FINRA securities arbitration claim about Klein, requesting $50,000.00 in damages. The allegations included unsuitable recommendations, misrepresentations, omissions, and breach of fiduciary duty in connection with the sale of private placement securities, specifically Energy 11. On May 19, 2022, the dispute was settled for $60,000.00. FINRA Arbitration No. 21-01227.
A separate customer initiated dispute was filed on November 3, 2020, alleging unsuitable recommendations, misrepresentation, omission, breach of fiduciary duty, and failure to supervise involving Energy 11. The customer sought $300,000.00 in damages. On August 2, 2021, the case was settled for $75,000.00. FINRA Arbitration No. 20-03649.
Another dispute, filed on August 31, 2020, involved allegations of misrepresentation, omission, breach of fiduciary duty, failure to supervise, fraud, and unauthorized trading, also involving private placements in Energy 11 and Energy 12. The customer requested $300,000.00 in damages. On December 6, 2021, the dispute was settled for $50,000.00. FINRA Arbitration No. 20-02750.
On December 19, 2016, a different customer alleged unsuitable recommendations in oil and gas investments, seeking $96,000.00 in damages for transactions occurring between 2014 and 2016. On February 1, 2018, the case was settled for $20,250.00. FINRA Arbitration No. 16-03626.
Additionally, on November 17, 2011, a customer initiated investment related dispute contained allegations of misrepresentation about real estate securities. The complaint was closed on November 7, 2013, after the customer was provided a full redemption.
Klein has been associated with David Lerner Associates Inc. as a stockbroker since 2005 and Spirit of America Management Corp. as an investment advisor representative since 2018.
