According to a complaint filed by the Massachusetts Securities Division, Securities America has been accused of failing to properly supervise one of its stockbrokers. The broker apparently ran a deceptive ad campaign aimed at senior citizens. The broker, Barry Armstrong (Armstrong Advisory Group), was not charged although he is the subject of a related cease and desist action.
According to authorities, Armstrong ran a radio advertisement aimed at “vulnerable Massachusetts senior citizens.” The complaint claimed the broker had special access to medical information and support regarding Alzheimer’s disease. He didn’t, however, and the ads were simply placed to grow his business within the senior citizen community.
The state claims that when seniors called for information about Alzheimer’s they were subject to the classic “bait and switch” and received information about investing through Securities America. Massachusetts claims that the ad campaign is “glaringly unethical misconduct.” We believe that ads targeting an especially vulnerable group of people constitute elder financial abuse.
Whatever you call it, we are shocked that Securities America approved the ad campaign.
Armstrong’s ad campaign wasn’t an isolated incident involving one or two ads in the middle of the night. Rather, regulators say he had a marketing budget of between $300,000 to $500,000 per year and advertised on one of the state’s largest radio stations.
The complaint was just filed. We do not yet know the response of Securities America. We are very concerned with elder financial abuse, particularly when it involves people who may be suffering from Alzheimer’s.
In fairness to Armstrong, the ads did contain a disclosure and he did seek approval from Securities America before running the ads. Ultimately brokerage firms are responsible for the actions of their employees.
A review of Armstrong’s record reveals that he has been in the industry for over 30 years. During that time he has received three complaints, although one was withdrawn. A complaint in 1998 caused his then employer to pay a customer $250,000 to settle a complaint about an unsuitable investment. His employer also shelled out an additional $250,000 in legal fees.
Several years later Armstrong was terminated by his employer for statements Armstrong made on a radio show!
Tens of thousands of seniors are victims of elder financial abuse each year. Often the perpetrator is a close friend or relative. Cases involving financial professionals are quite rare. While there is no evidence that Armstrong defrauded anyone with his Alzheimer’s radio campaign, we agree with the Massachusetts Securities Division that the campaign was ill advised and fraught with ethical problems.
If you or a loved one is the victim of elder financial abuse, give us a call. We prosecute losses of $1 million or more, although we will handle cases involving stockbrokers if the loss is $200,000 or more. Many cases can be handled quickly through binding arbitration. Our fraud recovery services can also usually be offered on a contingent fee or “success” fee basis.
MahanyLaw – America’s Investment Fraud Lawyers