Michael Edward Halla, of Manitowoc, Wisconsin, a stockbroker formerly registered with SII Investments, Inc., is the subject of a customer initiated investment related arbitration claim, which settled on July 31, 2017, for $21,688.00 in damages founded upon accusations that Halla botched a distribution from the customer’s variable annuity, which caused the customer to suffer tax consequences.
Financial Industry Regulatory Authority (FINRA) Public Disclosure reveals that Halla has been identified in four additional customer initiated investment related disputes pertaining to allegations of Halla’s misconduct while employed with SII Investments, Inc. and Ameriprise Financial Services, Inc. Particularly, on December 17, 2001, a customer filed an investment related written complaint involving Halla’s conduct, in which the customer requested $14,170.83 in damages founded upon accusations that he failed to provide the customer with adequate disclosures regarding life insurance policy fees.
Then, on May 29, 2012, a customer initiated investment related written complaint regarding Halla’s activities was resolved for $6,414.38 in damages founded upon accusations that Halla placed the unauthorized purchases of DPG and WBBBX mutual funds in the customer’s account. On March 21, 2011, another customer filed an investment related written complaint regarding Halla’s activities, in which the customer requested $6,961.00 in damages founded upon accusations that Halla made omissions to the customer regarding the terms and conditions of a variable annuity.
Halla has also been fined $10,000.00, disgorged of $18,000.00 in commissions, and suspended from associating with any Financial Industry Regulatory Authority (FINRA) member in any capacity based upon consenting to findings that he made unsuitable investment recommendations to a customer regarding closed end-funds. Letter of Acceptance, Waiver and Consent, No. 2012032915101 (Apr. 16, 2015).
According to the AWC, investment recommendations were made by Halla in twenty of the firm’s customer accounts, where he would routinely solicit customers’ investments in closed-end funds acquired in an initial public offering, and later recommend the positions to be liquidated in less than one year so that the funds could subsequently be used to purchase similar closed-end funds. Apparently, fifteen customer accounts were each exposed to short-term switching of closed-end funds acquired in an initial public offering. The AWC revealed that Halla failed to appreciate the risks of trading those funds on a short-term basis.
Moreover, FINRA found that the features and aspects relating to closed end funds were not understood by Halla. Specifically, the AWC stated that when Halla made recommendations to customers, he did not understand the impact of sales concessions on suitability; penalty periods on bidding; prior short-term switching repercussions; and price protection that closed end funds maintained for long-term and short-term marketing pricing. FINRA found that Halla’s unsuitable investment recommendations were violative of FINRA Rule 2010 and NASD Rule 2310.
FINRA Public Disclosure further reveals that Halla was fired from previous employer, Ameriprise Financial Services., founded upon accusations that he traded syndicate offerings on a short-term basis, and placed trades in customer accounts without the consent of the firm.
Guiliano Law Group
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