FINRA Orders IMS Securities and Two Reps to Pay $2.3 Million in Damages
An all-public FINRA arbitration panel awarded eight individual retirement account owners more than $2.3 million in compensatory damages from Houston-based IMS Securities and two reps.
The claimants asserted that IMS Securities and five of its reps over-concentrated their retirement portfolios in illiquid alternative investments in annuities and private placements, including United Development Funding IV, ARC New York City REIT and NetReit.
The allegations included “negligence and gross negligence, misrepresentation, omission of a material fact, failure to supervise, breach of fiduciary duty, breach of contract and control person liability.”
IMS Securities was ordered to pay $1.3 million in damages, Joshua Patterson was ordered to pay $670,211, and Stacey Rognon was ordered to pay $ 312,407, according to a report by FINRA’s Office of Dispute Resolution. Allegations against three of the firm’s reps were denied by the panel.
The arbitration panel denied a request from the brokers for expungement of their CRD records.
