John Howell, a broker associated with NYLIFE Securities LLC, is currently facing allegations from a customer regarding the recommendation to replace a surrender charge-free variable annuity with two fixed annuities in May 2023. The customer claims that this change resulted in a new surrender charge schedule and additional fees, prompting them to request the rescission of the fixed annuities and the restoration of the original variable annuity.
Haselkorn & Thibaut, a national investment fraud law firm with offices in Florida, New York, North Carolina, Arizona, and Texas, is currently investigating John Howell and NYLIFE Securities LLC in connection with these allegations. With over 50 years of combined experience and a 98% success rate, Haselkorn & Thibaut offers free consultations to clients who may have suffered losses due to financial advisor malpractice. Investors can contact the firm toll-free at 1-888-994-8066 for a confidential consultation, and the firm operates on a “No Recovery, No Fee” basis.
According to a Forbes article, financial advisor malpractice can have devastating consequences for investors, leading to significant losses and emotional distress. It is essential for investors to be aware of potential red flags and to seek professional help if they suspect misconduct or negligence on the part of their financial advisor.
Understanding the Allegations and FINRA Rules
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In simple terms, the customer alleges that John Howell advised them to replace a variable annuity that had no surrender charges with two fixed annuities. This change subjected the customer to a new set of surrender charges and additional fees, which they believe to be detrimental to their financial interests.
FINRA Rule 2111, known as the “Suitability Rule,” requires brokers to have a reasonable basis to believe that a recommended transaction 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. If a broker fails to adhere to this rule, they may be held liable for any resulting losses.
Furthermore, FINRA Rule 2330 specifically addresses the suitability of annuity transactions. This rule requires brokers to consider various factors, such as the customer’s age, liquidity needs, and investment goals, when recommending an annuity. Brokers must also disclose material features of the annuity, including surrender charges and fees.
The Importance for Investors
Protecting Your Financial Interests
This case highlights the importance of understanding the products and strategies recommended by financial advisors. Investors should always ask questions and seek clarification about the potential risks, fees, and charges associated with any investment or transaction.
The Role of Surrender Charges
Surrender charges are fees imposed by insurance companies when an investor withdraws money from an annuity before a specified period. These charges can significantly impact an investor’s returns and should be carefully considered when making any changes to an annuity portfolio.
Seeking Professional Advice
If an investor believes they have been misled or given unsuitable advice by a financial advisor, it is crucial to seek the guidance of experienced professionals, such as the attorneys at Haselkorn & Thibaut. These experts can help investors understand their rights and options for recovering any losses resulting from financial advisor malpractice.
Recognizing Red Flags and Recovering Losses
Red Flags for Financial Advisor Malpractice
- Recommending investments or strategies that do not align with the investor’s risk tolerance, financial goals, or investment timeline
- Failing to disclose material information about an investment, such as fees, charges, or potential risks
- Engaging in excessive trading or making unauthorized transactions in a client’s account
Recovering Losses Through FINRA Arbitration
Investors who have suffered losses due to financial advisor malpractice may be able to recover their losses through FINRA arbitration. This process allows investors to seek compensation from brokers and brokerage firms for misconduct or negligence.
Haselkorn & Thibaut has extensive experience representing investors in FINRA arbitration proceedings. With a 98% success rate and over 50 years of combined experience, the firm has helped numerous investors recover their losses. Investors can contact Haselkorn & Thibaut at 1-888-994-8066 for a free, confidential consultation to discuss their case and potential options for recovery.
Investors can also check the background and disciplinary history of their financial advisor by accessing their Central Registration Depository (CRD) record on the FINRA BrokerCheck website. This resource provides valuable information about a broker’s employment history, licenses, and any past complaints or regulatory actions.
As the investigation into the allegations against John Howell and NYLIFE Securities LLC unfolds, it serves as a reminder for investors to remain vigilant and proactive in protecting their financial interests. By staying informed, asking questions, and seeking the advice of experienced professionals when needed, investors can help safeguard their investments and hold financial advisors accountable for any misconduct or negligence.
