A formerly registered representative associated with Centaurus Financial, Inc. in Kings Park, New York, is accused of engaging in private securities transactions, also known as selling away, that allegedly exposed investors to substantial losses.
According to publicly available records, Byron Martinsen allegedly facilitated approximately $1.1 million in alternative investments outside the firm’s approved channels. With at least 24 disclosures on his record, investors who worked with Martinsen face serious questions about whether their losses stem from actionable misconduct.
If you or a family member experienced significant investment losses involving selling away or unauthorized alternative investments, Meyer Wilson Werning can help. Our team of experienced alternative investment attorneys focuses on representing investors who have been misled by financial professionals. Contact us for a free and confidential consultation.
What Do Current Disclosures Report About Bryon Martinsen?
According to his FINRA BrokerCheck profile, Bryon Martinsen (CRD# 1621649) has at least 24 disclosures on record. The disclosures span multiple allegation categories, and activity on his record has continued in recent years, with four new complaints and a permanent bar added since 2024.
The most prominent regulatory action is FINRA AWC No. 2018059212201, dated August 19, 2022. That action found Martinsen had participated in private securities transactions involving approximately $1.1 million in alternative investments without providing prior written notice to his firm. It also found that Martinsen made at least 150 payments totaling approximately $400,000 out of his personal and business bank accounts to compensate customers for losses from investments he had previously recommended, without notifying or receiving authorization from the firm. He also falsified three annual compliance questionnaires to conceal both the transactions and the payments.
Beyond the 2022 regulatory sanction, Martinsen’s recent disclosure history includes the following customer complaints:
- Overconcentration in illiquid, speculative investments: a pending complaint filed in July 2025 requests $250,000 in damages, alleging Martinsen concentrated client assets in unsuitable positions
- Unsuitable recommendations: a pending complaint filed in November 2025 requests $150,000 in damages, alleging Martinsen recommended unsuitable, high-risk investments
- Misrepresentation and omission of material risks: investors allege they were not told about significant risks associated with the products Martinsen recommended
- Failure to supervise: complaints raise questions about whether Centaurus Financial maintained adequate oversight of Martinsen’s activities
Recent publicly reported damage figures include a $250,000 pending claim alleging overconcentration in illiquid investments, a $175,000 claim that settled for $44,962, and a $150,000 pending claim alleging unsuitable, high-risk recommendations. Combined with the breadth of allegation types across 24 total disclosures, the record reflects a troubling pattern for anyone who entrusted money to Martinsen during his time at Centaurus Financial.
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What Do Past Complaints and Regulatory Actions Indicate for Centaurus Financial Investors?
Centaurus Financial, Inc. is a brokerage firm that has drawn regulatory attention beyond the Martinsen matter. Under FINRA Rule 3110 (Supervision), brokerage firms are required to maintain systems and procedures reasonably designed to detect and prevent misconduct by their registered representatives.
The allegations against Martinsen raise pointed questions about Centaurus Financial’s supervisory framework:
- Martinsen allegedly conducted private securities transactions involving $1.1 million in alternative investments without proper firm approval or oversight
- He allegedly received approximately $400,000 in customer payments connected to those transactions
- The conduct reportedly continued over a period of time before FINRA intervened
- Customer complaints referencing unsuitable investments and misrepresentation suggest a wider gap in the firm’s compliance monitoring
When a brokerage firm fails to catch and stop a broker’s unauthorized activity, the firm itself may bear liability for investor losses. Investors harmed by Martinsen’s alleged conduct may have claims not only against him personally but also against Centaurus Financial for failing to supervise his activities.
Selling Away, Private Securities Transactions, and Investor Protection Rules
Selling away occurs when a registered representative sells or recommends investments outside the brokerage firm’s approved product lineup without proper written notice to, and approval from, the firm. FINRA Rule 3280 on private securities transactions requires brokers to provide prior written notice to their member firm before participating in any securities transaction outside the scope of their employment. If the transaction involves compensation, the firm must approve and supervise the activity.
This rule exists because private securities transactions bypass the compliance checks that protect investors. When a broker sells products away from the firm, those investments are often unvetted, illiquid, or carry hidden risks that the investor never learns about until losses mount.
In Martinsen’s reported case, the private securities transactions allegedly involved alternative investments, a product category that frequently includes limited partnerships, private placements, and other instruments that can be difficult to value and nearly impossible to sell once purchased.
Under FINRA Rule 2111 (Suitability), brokers are required to have a “reasonable basis” to believe that a recommended investment is suitable for the client’s unique financial situation, age, and risk tolerance. For conduct after June 30, 2020, the SEC’s Regulation Best Interest (Reg BI) established an even higher “best interest” standard for broker-dealers.
Investors should watch for these warning signs of selling away:
- Account statements that do not list all investments the broker recommended
- Requests to write checks directly to a company or individual rather than to the brokerage firm
- Promises of guaranteed returns on “exclusive” or “off-book” opportunities
- Investments that are difficult to research or verify through public databases
- A broker who discourages you from discussing an investment with your firm or other advisors
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How Meyer Wilson Werning Can Help
Investors who lost money through Bryon Martinsen’s alleged selling away, private securities transactions, or other misconduct at Centaurus Financial may be able to pursue recovery through arbitration. FINRA arbitration is the primary dispute resolution process for claims between investors and brokers or brokerage firms, and it can move faster than traditional litigation.
Meyer Wilson Werning represents investors nationwide who have been harmed by broker misconduct, selling away, and supervisory failures. With more than 75 years of combined experience and over $350 million recovered for our clients, our team is dedicated to holding negligent firms accountable. Attorney David P. Meyer has spent over 26 years representing investors in cases involving broker fraud, fiduciary breaches, and unsuitable recommendations. Contact us today for a free and confidential consultation to discuss your path to recovery.
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Frequently Asked Questions
What are the allegations against Bryon Martinsen at Centaurus Financial?
Bryon Martinsen (CRD# 1621649) is accused of selling away, facilitating approximately $1.1 million in private securities transactions outside Centaurus Financial’s approved channels. FINRA Case No. 2018059212201 resulted in a 15-month suspension and a $10,000 fine. Additional customer complaints allege unsuitable recommendations, misrepresentation, omission of material risks, and fraud.
What does Bryon Martinsen’s BrokerCheck record show?
Martinsen’s BrokerCheck profile shows at least 24 disclosures, including regulatory sanctions and multiple customer complaints tied to selling away, unsuitable recommendations, and fraud. Reported damage figures include $231,244 in one matter, a $250,000 request in another, and more than $9 million in total reported investor losses.
Can investors recover losses from selling away broker misconduct?
Investors may be able to pursue recovery through arbitration when a broker’s unauthorized transactions caused losses. Claims generally rely on documentation such as account statements, correspondence, and complaint records to establish the scope of misconduct and damages.
What is selling away and why is it a serious investor issue?
Selling away occurs when a broker recommends investments outside the firm’s approved channels without proper notice or permission. FINRA Rule 3280 treats private securities transactions seriously because they bypass supervision, hide conflicts of interest, and expose investors to unsuitable or unvetted products. In Martinsen’s reported case, the conduct allegedly involved $1.1 million in alternative investments and approximately $400,000 in customer payments.
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