Founded in 1958 and headquartered in Atlanta, Georgia, FSC Securities Corporation (“FSC”) is one of the largest brokerage firms in the country. In 1992 it also registered as an investment adviser. It is a wholly owned subsidiary of Advisor Group, one of the largest networks of independent wealth management firms in the U.S.
Currently run by president and CEO, Jeff Sills, the fee-based firm has 2000+ advisor group employees, about 700 independent financial professionals throughout the U.S., and $34.9B in total client assets under administration (as of Dec. 31, 2021). It also has $12.8+ in assets under management (AUM) (as of July 21, 2022). It has licenses in all 50 states as well as the District of Columbia and Puerto Rico.
Financial Misconduct at FSC Securities Corp.
FSC is licensed by the Financial Industry Regulatory Authority (FINRA), and as such is legally obligated to ensure its brokers are acting lawfully in the interest of their investors. If a client suffers losses as a result of negligent behavior or misconduct from a broker, then the firm may be held legally responsible to repay the damages.
FSC and brokers backed by FSC have a long history of misconduct and complaints, as listed on FINRA’s BrokerCheck Report.
In October 2013, FSC was ordered to pay $844,335 in compensatory damages to nine clients regarding their investments in Price Financial Group and Montgomery Growth Fund. FSC was found to have been negligent, breached its fiduciary duty, misrepresented and omitted facts, offered unsuitable investments, and failed to supervise its advisors.
In September 2014, a group of investors filed a dispute resolution claim with FINRA against FSC, alleging that a number of brokers, including Aubrey Lee Price, sold “unspecific fraudulent securities as part of a Ponzi scheme.” The investors received $1.28+M in compensatory damages after a FINRA arbitration panel found that the firm was guilty of account-related failure to supervise and account-related negligence.
In March 2015, a FINRA arbitration panel ordered FSC to pay $73,333.34 in compensatory damages after the firm was found to have recommended an investment in a real estate investment trust (REIT), American Realty Capital Properties, as a safe investment. However, the REIT was actually a high-risk investment that was unsuitable for their goals and risk tolerance. The claimants argued that the firm had breached its fiduciary duty, breached its duty of care, misrepresented and omitted information, and provided unsuitable recommendations.
In 2018, FINRA fined FSC $200,000 after the firm allegedly failed to establish, maintain, and enforce a supervisory system and written supervisory procedures reasonably designed to supervise representatives’ sale of multi-share class variable annuities. Specifically, the system failed to address the suitability of issues related to different surrender periods, fees and costs of different variable annuity share classes. FSC failed to address suitability concerns regarding an L-share contract when combined with a long-term income rider or a long-term investment time horizon.
In December 2021, FINRA ordered FSC to pay $125,187.52 plus interest in partial restitution to customers after the firm failed to establish and maintain a supervisory system reasonably designed to supervise 529 plan share-class recommendations. FSC’s system was found not to reasonably address share-class suitability and failed to detect share-class recommendations that were inconsistent with the time horizon for those investments.
Once again, in November 2022, FINRA ordered FSC to pay $277,612.30 plus interest, in partial restitution to customers after the firm was alleged to have negligently failed to tell investors in an offering for which the issuer failed to timely make required filings with the SEC. FSC learned of the delays and the issuer’s stated intention to complete a forensic audit, but still made 60 sales totaling a principal amount of $4.2+M and earning $298,612 in commissions. The delay in filing audited financial statements was considered material information that the firm failed to disclose.
You May Have a Claim. Contact Our Firm Now!
As an investor, you have a right to recover investments lost through unethical behavior or decisions made against your interests. Meyer Wilson reclaimed $350 million for the victims of investment fraud or misconduct. Our attorneys are experienced in going up against large investment firms, such as FSC Securities Corporation, and our track record affirms our resources and expertise. Meyer Wilson has represented clients nationwide and internationally, in state and federal courts, and in arbitration through FINRA and the American Arbitration Association (AAA).
If you believe that you have been the victim of investment fraud or have been recommended unsuitable investments, you may have options. Call Meyer Wilson today!
