Investors who worked with former financial advisor James Edward McArthur are facing mounting concerns as public records reveal a troubling pattern of unpaid arbitration awards, indefinite regulatory suspensions, and allegations involving high-risk promissory notes. According to recent reports, an arbitration panel ordered McArthur and his former firm to pay a client $1,440,899, an award that reportedly remained unpaid as of October 6, 2025.
If you or a family member suffered significant investment losses while working with James McArthur, you are not alone—the securities fraud lawyers at Meyer Wilson Werning can help. Reach out today for a free and confidential consultation to discuss your next steps with us.
Why Was James McArthur Suspended Indefinitely by FINRA?
Regulatory records indicate that James McArthur (CRD #2797856) is no longer registered with any brokerage firm and has been placed under multiple indefinite suspensions. These actions were triggered by his alleged failure to comply with arbitration-related obligations and a lack of cooperation with regulatory inquiries.
Key Regulatory Sanctions in 2025
- December 2, 2025: FINRA initiated an expedited action (Case No. 24-00987) against McArthur for failing to comply with an arbitration award or settlement agreement. This resulted in an indefinite suspension.
- October 16, 2025: A second indefinite suspension was ordered (Case No. 24-01241) under similar allegations regarding his failure to respond to information requests or satisfy arbitration debts.
- FINRA Rule 9554: These suspensions were enforced under a rule designed to ensure that brokers satisfy their financial obligations to clients. McArthur remains barred from associating with any FINRA member firm in any capacity until these matters are resolved.
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$350 Million for Our Clients Nationwide.
What Are the Allegations Involving Promissory Notes and Par Funding?
A significant portion of the claims against McArthur stem from his time with A.G. Morgan Financial Advisors, LLC and IBN Financial Services, Inc. between 2021 and 2022. Investors have filed numerous disputes alleging that McArthur recommended unsuitable promissory notes and misled clients about the risks involved.
Important Points Regarding Investor Claims
- Unpaid $1.4 Million Award: A case served on May 6, 2024, resulted in a $1,440,899 award for a customer on August 10, 2025. This award was reportedly still unpaid as of late 2025.
- Pending $540,000 Claim: A pending arbitration served on July 31, 2025 (Claim No. 25-01150) alleges unsuitability, breach of fiduciary duty, and failure to supervise related to promissory note sales.
- Par Funding Scheme: McArthur was permitted to resign from IBN Financial Services on June 17, 2022, amid allegations of selling unregistered securities connected to a fraudulent $500 million offering involving Complete Business Solutions Group Inc. (d/b/a Par Funding).
- SEC Charges: In June 2022, the SEC charged McArthur, Vincent Camarda, and A.G. Morgan for their roles in raising over $75 million from more than 200 investors for Par Funding. The complaint alleged they acted as unregistered broker-dealers and failed to inform clients of a $750,000 conflict of interest.
How Do Regulation Best Interest and Supervisory Rules Protect You?
When brokers recommend investments like promissory notes, they must adhere to strict regulatory standards, including Regulation Best Interest (Reg BI). This rule, effective June 30, 2020, requires financial professionals to put the client’s interest ahead of their own.
Obligations Brokers Must Uphold
- Care Obligation: Advisors must exercise reasonable diligence and skill when making recommendations, considering the client’s profile and available alternatives.
- Disclosure Obligation: All material facts, including conflicts of interest and fees, must be clearly communicated to the client.
- Supervision Requirements: Under FINRA Rule 3110, brokerage firms are legally responsible for monitoring their advisors’ activities to prevent fraud, misappropriation, and unsuitable sales practices.
When firms fail to maintain these safeguards, they can be held liable for the resulting damages. Even if a broker like McArthur is suspended or insolvent, investors may still pursue recovery against the brokerage firms that employed him during the time of the misconduct.
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Seeking Recovery for James McArthur Investment Losses
The combination of unpaid awards, indefinite suspensions, and allegations of fraudulent unregistered offerings creates a complex legal landscape for affected investors. Recovering lost funds often requires proving that the advisor or the firm violated their duties of care and supervision.
At Meyer Wilson Werning, we represent investors nationwide who have been harmed by broker misconduct and investment fraud. We have the resources to take on large firms and have recovered over $350 million for our clients. If you lost money in promissory notes or other investments recommended by James McArthur, contact us today for a free and confidential consultation. Let us review your case and help you understand your legal options for recovery.
Frequently Asked Questions
What is the significance of James McArthur’s 2025 FINRA suspensions?
The suspensions indicate that McArthur has failed to pay arbitration awards to his clients or has refused to cooperate with official investigations. This effectively bars him from the securities industry until these legal and financial obligations are met.
Can I still recover losses if my broker is no longer registered?
Yes. Investors can often file claims against the brokerage firms (such as IBN Financial Services or A.G. Morgan) that were responsible for supervising the broker at the time the misconduct occurred. Firms have a legal duty to protect clients from unsuitable or fraudulent recommendations.
What are the main red flags in the James McArthur case?
Key red flags include the recommendation of high-risk, illiquid promissory notes, the failure to disclose conflicts of interest (such as unpaid loans from Par Funding), and a history of multiple customer complaints seeking millions in damages.
How does arbitration work for recovering investment losses?
Arbitration is a private legal proceeding used to resolve disputes between investors and financial firms. It is typically faster than traditional court litigation. An experienced attorney can help you gather evidence, such as account statements and communications, to build a strong case for compensation.
Recovering Losses Caused by Investment Misconduct.
