Haselkorn & Thibaut, P.A., operating as Investment Fraud Lawyers, is reviewing the September 2026 FINRA settlement against American Portfolios Financial Services, Inc. The regulator ordered the firm to pay about $1.6 million after finding that it failed to supervise recommendations that customers sell unit investment trusts before maturity. If you were an American Portfolios customer and lost money on UITs or other investments, call our firm at 1-888-885-7162 for a free case review.
About American Portfolios Financial Services
American Portfolios Financial Services, Inc. was a FINRA-member broker-dealer headquartered in Holbrook, New York, with CRD number 18487. The firm had been registered with FINRA since 1987 and operated as an introducing broker-dealer serving retail investors through a nationwide network of registered representatives.
In November 2022, American Portfolios was acquired by Osaic Holdings, Inc., the entity formerly known as Advisor Group. American Portfolios was merged into Osaic Wealth, Inc. on October 15, 2024. As a result, it is no longer an independent broker-dealer.
Investors with claims related to American Portfolios accounts may need to direct recovery efforts against Osaic Wealth or against individual representatives who handled their accounts.
FINRA’s September 2026 UIT settlement
On September 22, 2026, FINRA announced that it had ordered American Portfolios to pay $1,232,939 in restitution, plus interest, and fined the firm $400,000. The case involved recommendations to sell unit investment trusts before maturity from January 2018 through October 14, 2024.
According to FINRA, American Portfolios failed to establish a supervisory system, including written policies and procedures, reasonably designed to oversee UIT recommendations. The firm did not give supervisors a method for considering the front-loaded cost structure of UITs or for spotting representatives who repeatedly recommended early sales and reinvestment into new UITs.
| Settlement component | Amount |
|---|---|
| Fine | $400,000 |
| Restitution to customers | $1,232,939.09 plus interest |
| Total monetary obligation | About $1.6 million |
| Customers affected | 295 |
What FINRA found
American Portfolios customers purchased approximately $470 million in UITs during the relevant period. FINRA said the firm had no system to identify early UIT sales until October 2018, and even after that the trade alerts did not show how close to maturity a UIT was sold.
Three representatives accounted for most of the problematic activity. Two representatives working as a team recommended early UIT sales roughly 61% of the time. Their customers held UITs for only about half of the term length on average.
A third representative recommended early sales about 78% of the time. In total, 295 customers paid $1,232,939 in costs and fees they would not have incurred had they held the UITs to maturity.
| Representative pattern | Early sale rate | Customers affected | Estimated excess costs |
|---|---|---|---|
| Two representatives working as a team | About 61% | 139 | At least $872,960.53 |
| Third representative | About 78% | 156 | At least $359,978.56 |
Other recent regulatory actions against American Portfolios
The UIT settlement is not the only recent enforcement action involving American Portfolios or its affiliated advisory firm. Investors should be aware of the broader regulatory record.
| Date | Regulator | Matter | Outcome |
|---|---|---|---|
| January 2025 | FINRA | Bank deposit program fee overcollection and undisclosed surplus interest | $550,000 fine; $4.6 million restitution |
| July 2025 | SEC | American Portfolios Advisors disclosure failures and overbilling advisory clients | Administrative action; $4.5 million-plus reimbursement to clients |
| September 2026 | FINRA | Failure to supervise early UIT sales | $400,000 fine; $1.23 million restitution |
How the UIT sales practice harmed investors
Unit investment trusts are designed to be held until a fixed maturity date, often 15 or 24 months. Investors pay upfront sales charges when they buy. If a representative recommends selling early and buying a new UIT, the investor pays a new set of charges and may lose the benefit of holding the original trust to maturity.
When this pattern is repeated, the costs compound. Customers may be moved from one UIT to another without a sufficient investment reason. The result is fee churning: the representative generates transaction-based compensation while the customer absorbs unnecessary costs.
What investors who lost money with American Portfolios can do
If you were among the 295 customers identified by FINRA, you may receive restitution automatically. If you had other UIT transactions at American Portfolios that were not part of the settlement, you may still have a claim. Gather your account statements, trade confirmations, and any communications about the UIT recommendations.
Because American Portfolios merged into Osaic Wealth in October 2024, claims may be directed against Osaic as the successor entity. Claims may also be brought against the individual representatives who handled the account, even if they have moved to another firm. An experienced securities attorney can identify the proper respondents.
How Investment Fraud Lawyers can help
Haselkorn & Thibaut, P.A., operating as Investment Fraud Lawyers, represents investors who have lost money because of unsuitable recommendations, supervisory failures, and excessive fees. We review account records, identify the parties responsible, and pursue recovery through FINRA arbitration, negotiated settlement, or other available legal channels.
We handle most investor-loss cases on a contingency basis. You do not pay legal fees unless we recover money for you. Call 1-888-885-7162 for a free case review.
American Portfolios brokerage firm complaints and losses
American Portfolios Financial Services has been the subject of repeated regulatory scrutiny in recent years. The September 2026 UIT settlement is the latest in a series of enforcement actions against the firm or its affiliated investment adviser. For investors, these cases raise questions about whether the firm had adequate controls to protect customer interests.
The brokerage firm complaints against American Portfolios center on two recurring themes: unsuitable investment recommendations and inadequate supervision. In the UIT matter, FINRA found that the firm allowed representatives to steer customers into repeated early sales of unit investment trusts.
That practice generated transaction-based compensation for the representatives while imposing unnecessary costs on clients. Customers who suffered losses may have grounds to pursue recovery.
Customers who suffered losses may have grounds to pursue recovery through FINRA arbitration, a civil claim, or a negotiated settlement. Because American Portfolios merged into Osaic Wealth in October 2024, the proper respondent may be Osaic, the individual representative, or both.
Understanding unit investment trusts and early-sale risk
A unit investment trust is a fixed portfolio of securities, usually stocks or bonds, that terminates on a set maturity date. UITs are generally designed to be held until maturity, often 15 or 24 months. Investors pay an upfront sales charge when they purchase shares.
When a registered representative recommends selling a UIT before maturity and reinvesting the proceeds in a new UIT, the customer pays a fresh sales charge. If the original UIT had not yet generated enough return to offset that upfront cost, the customer loses money. FINRA Rule 2111 requires that recommendations be suitable for the customer, and Regulation Best Interest requires broker-dealers to act in the customer’s best interest when making recommendations.
In the American Portfolios case, FINRA said the firm’s supervisory system was not reasonably designed to detect these early-sale patterns. Under FINRA Rule 2111, recommendations must be suitable for the customer. Under Regulation Best Interest, firms must put the customer’s interests ahead of their own. The firm’s failures left 295 investors paying costs and fees they should not have owed.
Who may be liable for American Portfolios investor losses
Several parties may bear responsibility for losses connected to American Portfolios UIT recommendations. The analysis depends on who made the recommendation, who supervised the activity, and which entity now holds the firm’s liabilities.
| Potential respondent | Role in the claim |
|---|---|
| Osaic Wealth, Inc. | Successor to American Portfolios; may carry liability for firm-level supervisory failures after the October 2024 merger. |
| Individual registered representatives | May be named for unsuitable recommendations or material misrepresentations about UITs |
| Supervisory personnel | May share liability if they failed to detect or address red flags |
| Third parties | In some cases, due diligence firms, clearing firms, or product sponsors may bear partial responsibility |
How to start an American Portfolios loss recovery claim
If you believe you lost money because of unsuitable UIT recommendations at American Portfolios, start by collecting your account statements, trade confirmations, and any written or electronic communications with your advisor. These documents help establish the timeline and pattern of recommendations.
Next, review your FINRA BrokerCheck report for the representative who handled your account. Look for prior customer disputes, regulatory actions, or employment terminations. This information can strengthen your claim and help identify additional respondents.
Finally, speak with a securities attorney about whether FINRA arbitration or another forum is appropriate. Time limits apply, so delaying the review can affect your ability to recover.
Frequently asked questions
What did American Portfolios do wrong?
FINRA found that American Portfolios failed to reasonably supervise recommendations that customers sell UITs before maturity. The firm lacked policies and systems to identify representatives who repeatedly recommended early sales and reinvestment into new UITs, causing customers to pay unnecessary costs.
How much will affected customers receive?
FINRA ordered $1,232,939.09 in restitution, plus interest, for 295 customers. Individual restitution amounts range from $102.27 to $399,055.29 depending on the customer’s specific losses.
Can I still file a claim if I was not on FINRA’s restitution list?
Yes. If you were an American Portfolios customer and believe you lost money because of unsuitable UIT recommendations, you may still have a claim. The FINRA settlement does not prevent private arbitration or legal action for customers not included in the regulator’s restitution order.
Who is responsible now that American Portfolios merged into Osaic?
Osaic Wealth, Inc. may bear successor liability for claims arising from American Portfolios’ conduct. Individual representatives who recommended the transactions may also be named. An attorney can review your account history and determine the proper respondents.
How long do I have to bring a claim?
Time limits apply. FINRA arbitration claims are generally subject to a six-year eligibility rule, but state statutes of limitations may be shorter. You should speak with a securities attorney promptly to preserve your rights.
Disclaimer: Past results do not guarantee future outcomes. This page provides general information and is not legal advice. No attorney-client relationship is formed by reading this content.
There is no guaranteed recovery in any securities matter. Consult a qualified attorney regarding your specific situation.