FINRA’s Department of Enforcement investigated Schober’s misconduct and alleged he recommended unsuitable annuity exchanges in the accounts of two senior customers in violation of FINRA Rules 2111, 2330(b) and 2010. The two investors paid total surrender charges of approximately $154,642 to exchange their annuities. Additionally, the two customers paid Schober $65,000 in commissions for the three annuity contracts switches, respectively.
According to FINRA, Schober also concealed the unsuitable exchanges by providing false information concerning the source of funds on the annuity transaction documents he submitted to SII Investments in violation of FINRA Rules 4511 and 2010. Specifically, Schober falsely indicated that the source of the funds for the annuity purchased was from a Bank Account or Savings Accounts, as opposed to their true source, from an annuity exchange.
Based upon the foregoing misconduct, FINRA alleged Schober violated FINRA Rules 2010, 2111 2330(b)(1) and 4511. FINRA Rule 211 requires financial advisors to have a reasonable basis 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. Here, for example, FINRA alleged Schober did not have a reasonable basis to recommend annuity exchanges that were unnecessary and only benefitted himself monetarily.
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 Schober through SII Investments, 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.