In a recent development, a customer dispute has been filed against Billy Aycock, a broker and investment advisor associated with Cabin Securities, Inc. (CRD# 137608) in Kansas. The claim, which is currently pending resolution, alleges breach of fiduciary duty, breach of contract, negligence, negligent supervision, violation of Illinois securities law, and fraudulent inducement to hold investments in various REITs, including Hospitality Investors Trust REIT, Lodging Opportunity Fund REIT, and Priority Income Fund.
The claimant, whose identity remains undisclosed, has accused Aycock and Cabin Securities of misconduct related to these real estate securities. While the specific dates of the alleged misconduct have not been specified, the claim was filed on January 29, 2024, and the requested damage amount has not been disclosed. Aycock has denied all claims, stating that he did not know or interact with the claimant and was not the supervisor for the transactions in question.
Haselkorn & Thibaut, a national investment fraud law firm with offices in Florida, New York, North Carolina, Arizona, and Texas, is currently investigating Billy Aycock and Cabin Securities in relation to this customer dispute. The firm, known for its impressive 98% success rate and over 50 years of combined experience, is offering free consultations to clients who may have suffered losses due to the alleged misconduct.
Understanding the Allegations and FINRA Rules
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The allegations against Billy Aycock and Cabin Securities revolve around several key issues:
- Breach of fiduciary duty: Financial advisors have a legal obligation to act in their clients’ best interests. A breach of this duty occurs when an advisor prioritizes their own interests or fails to provide suitable advice.
- Breach of contract: This allegation suggests that Aycock and Cabin Securities may have violated the terms of their agreement with the client.
- Negligence and negligent supervision: These claims imply that Aycock and Cabin Securities failed to exercise reasonable care in their dealings with the client and that the firm did not adequately supervise Aycock‘s activities.
- Violation of Illinois securities law: Each state has its own securities laws designed to protect investors. The claimant alleges that Aycock and Cabin Securities violated Illinois’ specific regulations.
- Fraudulent inducement to hold investments: This allegation suggests that Aycock and Cabin Securities may have misled the client into holding certain investments, such as the REITs mentioned in the claim.
FINRA, the Financial Industry Regulatory Authority, maintains rules and regulations to protect investors and ensure fair practices in the securities industry. FINRA Rule 2111, known as the “suitability rule,” requires brokers to have a reasonable basis for believing that a recommended investment or strategy is suitable for the client based on their financial situation, risk tolerance, and investment objectives. Violations of this rule can lead to disciplinary action and legal consequences.
Investment fraud and bad advice from financial advisors can have devastating consequences for investors. According to a Bloomberg article, investment fraud cost Americans $1.7 billion in 2020 alone. It is crucial for investors to be vigilant and conduct thorough research when selecting a financial advisor to minimize the risk of falling victim to fraudulent practices or unsuitable advice.
The Importance for Investors
This case highlights the importance of working with trustworthy and ethical financial advisors. Investors rely on the expertise and guidance of their advisors to make informed decisions about their investments, and any breach of trust or misconduct can have severe consequences.
Potential Impact on Investors’ Portfolios
If the allegations against Billy Aycock and Cabin Securities are proven true, investors who followed their advice may have experienced significant losses in their portfolios. The REITs mentioned in the claim, such as Hospitality Investors Trust REIT, Lodging Opportunity Fund REIT, and Priority Income Fund, may have performed poorly or failed to meet the clients’ investment objectives.
The Role of Due Diligence
This case underscores the need for investors to conduct thorough due diligence when selecting a financial advisor. Researching an advisor’s background, qualifications, and disciplinary history can help identify potential red flags. Investors can access an advisor’s record through FINRA’s BrokerCheck (https://brokercheck.finra.org/individual/summary/4069907), which provides information on their employment history, licenses, and any past disputes or disciplinary actions.
Red Flags for Financial Advisor Malpractice
Investors should be aware of several warning signs that may indicate financial advisor malpractice:
- Recommendations that consistently underperform or fail to align with the client’s goals and risk tolerance
- Lack of transparency regarding fees, commissions, or potential conflicts of interest
- Pressure to make quick decisions or invest in products the client does not fully understand
- Unauthorized trades or account activity
- Failure to communicate regularly or provide timely updates on the client’s portfolio
Seeking Legal Assistance
Investors who suspect they have been victims of financial advisor malpractice should consider seeking legal assistance. Firms like Haselkorn & Thibaut specialize in representing investors in securities fraud cases and can help clients navigate the complex legal process.
Recovering Losses Through FINRA Arbitration
FINRA Arbitration is a common method for investors to recover losses stemming from financial advisor misconduct. This process allows investors to present their case before a panel of neutral arbitrators who will hear evidence and render a binding decision. Haselkorn & Thibaut‘s experienced attorneys can guide clients through the arbitration process and work tirelessly to help them recover their losses.
For investors who believe they may have been affected by the alleged misconduct of Billy Aycock and Cabin Securities, or any other financial advisor, Haselkorn & Thibaut offers free consultations. With a 98% success rate and a “No Recovery, No Fee” policy, the firm is committed to fighting for investors’ rights. Contact them toll-free at 1-888-885-7162 to discuss your case and explore your legal options.
