FINRA ordered Summit Brokerage Services, which is a Cetera Financial Group independent broker-dealer, to pay $880,000 in fines and restitution to settle allegations of supervisory failures and excessive trading, such as that by ex-representative Christopher Stephen Jorgensen, whom FINRA previously barred.
FINRA Executive Vice President of Enforcement Susan Schroeder summed it up thusly: "The affected customers paid hundreds of thousands of dollars in commissions as a result of the excessive trading that occurred in their accounts."
In AWC #2016052655301 with Summit Brokerage Services, FINRA wrote that Summit failed to establish and maintain an adequate supervisory system for five years—from 2012 through 2017—and failed to reasonably supervise brokers' recommended securities transactions relative to potentially excessive trading.
For example, Summit purportedly failed to supervise stockbroker Christopher Jorgensen (CRD #1919475), whom investigators claim excessively traded 14 customer accounts.
The regulator wrote that Summit broker Jorgensen recommended 267 trades over a three-year period in one such account held by a retired woman with a net worth of less than $500,000, and similarly recommended several hundreds of trades in other accounts belonging to retired persons.
FINRA found that Jorgensen's misconduct caused his customers to pay $651,405 in commissions while producing realized losses of more than $300,000. FINRA barred Jorgensen in 2017.
Finally, FINRA found that Summit Brokerage Services itself failed to enforce written supervisory procedures and failed to have a reasonable system to track whether its representatives complied with various firm policies.
If you have invested with Cetera affiliate Summit Brokerage Services, former broker Christopher Stephen Jorgensen, or with any stockbroker or financial adviser whose excessive trading—or a firm whose failure to supervise a rogue representative who unsuitably recommended excessive trades—has proven harmful to your investments or interests through high commissions and fees or account losses and damages, please call our experienced FINRA arbitration attorneys at The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for an investigation and consultation.