FINRA Award Involving Christopher Tolmacs and Triad Advisors
According to reports, FINRA arbitrators have awarded two clients of former broker Christopher Tolmacs $1.2 million in compensatory damages and $300,000 in punitive damages based on "willful wanton misconduct, conversion of funds and securities fraud."
The Financial Industry Regulatory Authority said in the award that Tolmacs denied the allegations made by former clients Karen and David Gottschall and asserted various defenses.
According to his FINRA BrokerCheck report, Tolmacs was registered with Triad Advisors in Portage, MI from April 2008 to March 2016. He also operated Harbinger Financial Group and Harbinger Asset Management. Tolmacs has thirteen disclosures listed on his BrokerReport, including eight customer complaints.
In March 2016, State securities regulators in Michigan reportedly revoked Tolmacs investment adviser and securities registrations. He was also ordered to pay a $50,000 fine.
FINRA also reportedly barred Tolmacs in March 2016 after he failed to respond to requests for documents and failed to appear at a hearing looking into whether he entered into prohibited lending arrangements with his clients.
Failure to Supervise
Brokers have a fiduciary duty to make investment recommendations that are consistent with the clients net worth, investment experience and objectives. Risk tolerance, age, and liquidity needs also need to be considered. Furthermore, brokers are prohibited from engaging in underhanded businesses practice, like churning or unauthorized trading, that violate securities laws and regulations.
When brokers abuse client accounts and violate securities laws, the brokerage firm they are working for may be liable for investment losses. Brokerage firms that fail to monitor their employees’ business activities may be held liable for investment losses.
The White Law Group is a national securities fraud, securities arbitration, investor protection and securities regulatory/compliance law firm with offices in Chicago, Illinois and Vero Beach, Florida.
Daxton White, Managing Partner
The White Law Group, LLC
595 21st St,
Vero Beach, FL 32960
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