FINRA suspended and fined Daniel Steuer Miller, formerly of Growth Capital Services in San Francisco, California, for participating in undisclosed and prohibited private securities transactions totaling about $560,000 in an outside investment, namely several real estate ventures through his non-Growth employment with Rise Securities LLC, Westmill Capital Partners (since shutdown), Fundrise, and Popularise LLC.
According to the findings, one of Miller's outside companies engaged in crowdfunding of real estate projects in 2014 by conducting a private offering of preferred shares, and that Miller participated without informing or getting authorization from FINRA-member Growth Capital. The findings state that as secretary/treasurer, and later President, Miller solicited investments from several clients, who collectively invested $560,000 in the offering.
The AWC notes that in participating in such private securities transactions without providing prior written notice to Growth Capital, Miller violated both firm and industry policies and rules by engaging in a prohibited outside business activity.
In 2013, Curbed ran a feature on Miller, touting his FINRA licenses and offering a glimpse into Fundrise's business model. For instance, the article states that because Securities Act/SEC Regulation D restricts/protects unaccredited investors from public investment in certain markets, Miller's company used Regulation A to raise its capital, calling it, "the new way to invest in real estate." However, whether by Regulation A or D, industry rules require all brokers and financial advisers to inform their associated firm of such activity which is effected outside of the scope of employment or association with said firm. That a prospective investor is "accredited" to invest does not lessen the brokerage firm's and broker's suitability obligations.
If you have invested with Daniel Steuer Miller at Growth Capital, or with any broker or financial adviser who has solicited or executed unauthorized outside business activities or transactions outside of the scope of his/her employment with a FINRA-member firm, and this improper act of selling away has proven harmful to your investments or interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for an investigation and consultation.