The Financial Industry Regulatory Authority (FINRA) fined, suspended and ordered registered principal Russell Kent Childs to pay over $400,000 in restitution to customers who experienced financial losses due to patent misconduct.
FINRA Case #2010022296201
FINRA found that while he was employed at Cambridge Legacy Securities, LLC, Childs sold a Medical Capital Holdings, Inc. private placement offering to multiple customers without first conducting adequate due diligence of the private placement. Childs therefore did not have a reasonable basis for his recommendation of the offering, which later resulted in multiple delinquencies and defaults of Medical Capital properties.
Had Childs researched Medical Capital, he would have seen the Anaheim-based financing company was having significant trouble making principal and interest payments to investors, in addition to the aforementioned delinquencies and defaults. Because Childs failed to conduct his due diligence, he missed these red flags that Medical Capital was a Ponzi scheme and continued to make improper and unsuitable recommendations to his customers, putting their investments and interests in serious financial jeopardy.
If you suspect a broker or firm has engaged in practices that have put your investments or interests at great risk, such as making improper recommendations, or failing to conduct due diligence, call The Law Offices of Jonathan W. Evans & Associates at