October 2016-Plano, Texas
The Texas State Securities Board (TSSB) entered a Disciplinary Order against M. F. (Mickey) Long II who operates First Financial Services Group in Plano, TX, and stock brokerage firm Calton & Associates.
The TSSB Order made certain findings with regard to Mr. Long’s business practices during the time he was employed by VSR Financial Services (6/2002-6/2016), including the following:
- Long routinely recommended that VSR Financial clients invest in on-listed real estate investment trusts (REITs) and interests in exploratory drilling programs sold through private offerings (Alternative Investments)
- Long recommended that a client of VSR Financial who was over 70 years of age invest in Alternative Investments at risk tolerance levels that were excessive.
- Long did not have a reasonable basis to believe that the recommendations he made to invest in the Alternative Investments were suitable for this elderly client.
Long and Calton agreed that so long as Mr. Long is registered with Calton he will not sell or recommend the purchase of any Alternative Investments. In addition, Long and Calton agreed that will establish a heightened supervision plan for the supervision of Mr. Long’s practice for two years. Mr Long’s registration with TSSB was suspended for 45 days as a part of the Order.
VSR Financial’s Prior Issues with Alternative Investments
VSR Financial Services was fined $550,000 by the Financial Industry Regulatory Authority (FINRA) in May 2013 in connection with the sale of alternative investments. In their findings, FINRA criticised VSR Financial for recommending high concentration levels of alternative investments in customer accounts and for its lack of supervision over the use of consolidated reports prepared by brokers and provided to customers. During the summer of 2016, VSR Financial announced that they were winding down their brokerage business and transferring accounts and brokers to an affiliated entity Summit Brokerage Services.
Alternative investments include non publicly traded real estate investment trusts (REITS) , hedge funds, real estate, commodities and derivatives contracts and, managed futures. It may also include art, wine, antiques, coins or stamps. These investments tend to be complex, illiquid, nontransparent, hard to value and expensive. Many of the alternative investments sold over recent years are not traded on any public market making them difficult to value and even more difficult to liquidate if cash is needed.
If you have losses in an account in an account handled by Mickey Long or VSR Financial Services , contact us to discuss how you may be able to recover damages for those losses.
Rex Securities Law , with offices in Boca Raton, FL, and Austin, TX, provides representation to investors nationwide who are seeking recovery of investment losses due to the negligence or fraud of stockbrokers and broker dealers. If you have questions about how your account has been handled, call to speak with an experienced securities attorney.
Most cases handled on a contingent fee basis meaning that you do not pay legal fees unless we are successful.
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