FINRA’s complaint focuses on several areas of potential misconduct. According to the allegations, during the period from May 2012 through March 2014, Lockey engaged in unsuitable short-term trading and switching in open-end mutual funds, closed-end funds, and/or unit investment trusts in four different customer accounts. In total, the unsuitable trading generated gross compensation of $75,729.88 for Lockey and SWS, while the customers suffered collective trading losses totaling $15,699.38.
Specifically, Lockey executed 74 trades in open-end mutual funds, closed-end funds, and/or unit investment trusts in the customers’ accounts in which the holding periods for the transactions ranged from 22 days to eleven months. Lockey also allegedly falsified SWS Financial switch forms by including inaccurate purchase dates for certain open-end mutual funds, closed-end funds, and/or unit investment trusts transactions, which created the appearance that the securities had been held in certain customers’ accounts for a longer period than they actually had been.
Based upon the foregoing misconduct, FINRA alleges Lockey violated FINRA Rules 2010, 2111, 4511(b). FINRA Rule 2111, for example, requires financial advisors to recommend suitable investments and investment strategies to their clients (known as the suitability rule) based upon the client’s unique financial situation, including investment objectives and risk tolerance.
Lufrano Law, LLC is a national securities litigation firm and has experience representing investors who have investment disputes with brokers and broker-dealers. If you suffered investment damages investing with Lockey through SWS Financial, you may be able to recover your losses through FINRA arbitration. Our firm only receives a fee if you recover money. Please contact one of our attorneys at (800) 627-2179 to schedule a free consultation or complete our free case evaluator.