Dharmesh Vora, a registered investment advisor with Kalos Capital, Inc. (CRD# 44337) in Arizona, is facing allegations of unsuitable investment advice related to the recommendation of structured notes in 2021. The customer dispute, filed on January 21, 2024, is currently pending resolution.
Investment fraud and bad advice from financial advisors can have devastating consequences for investors. According to a Bloomberg article, investment fraud has been on the rise during the pandemic, with market volatility and economic uncertainty creating opportunities for unscrupulous advisors to take advantage of vulnerable investors.
Understanding Structured Notes and FINRA Rule 2111
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Structured notes are complex financial instruments that combine the features of debt securities and derivatives. They are often linked to the performance of an underlying asset, such as a stock, index, or commodity. While structured notes can offer potential benefits, such as customized payouts and downside protection, they also come with significant risks.
FINRA Rule 2111, known as the “Suitability Rule,” requires brokers and investment advisors to have a reasonable basis to believe that a recommended investment or investment strategy is suitable for the customer, based on the customer’s investment profile. This profile includes factors such as age, financial situation, investment objectives, and risk tolerance.
The Impact on Investors
Unsuitable investment advice can have severe consequences for investors. When an advisor recommends an investment that does not align with the client’s risk tolerance or financial goals, it can lead to significant losses. Structured notes, in particular, can be challenging for investors to understand due to their complex nature and potential risks.
Investors who have suffered losses due to unsuitable investment advice may be entitled to recover damages through FINRA arbitration. This process allows investors to seek compensation for their losses without going through the traditional court system.
Red Flags and Seeking Help
Investors should be aware of red flags that may indicate financial advisor malpractice, such as:
- Recommending investments that do not align with the client’s risk tolerance or financial goals
- Failing to provide adequate information about the risks and characteristics of an investment
- Encouraging over-concentration in a single investment or asset class
If you suspect that you have been a victim of unsuitable investment advice, it is essential to seek help from experienced professionals. Haselkorn & Thibaut, a national investment fraud law firm with offices in Florida, New York, North Carolina, Arizona, and Texas, is currently investigating Dharmesh Vora and Kalos Capital, Inc. The firm offers free consultations to clients and has a proven track record of success, with a 98% success rate in helping investors recover losses.
With over 50 years of combined experience, the attorneys at Haselkorn & Thibaut have the knowledge and expertise to guide investors through the FINRA arbitration process. They work on a contingency basis, meaning there are no fees unless they recover money for their clients.
If you have suffered investment losses due to the actions of Dharmesh Vora or any other financial advisor, contact Haselkorn & Thibaut today at 1-888-885-7162 for a free consultation. Their experienced team will review your case and help you understand your legal options for recovering your losses.
