LPL Financial LLC and its broker, Tammy Paquette, are currently facing allegations of unsuitable investment recommendations made to customers in 2013. The customers claim that the investments, which involved real estate securities, were not aligned with their investment objectives and risk tolerances. According to a recent study by the Forbes Finance Council, unsuitable investment recommendations are a common form of investment fraud that can lead to significant financial losses for investors. Haselkorn & Thibaut, a national investment fraud law firm, is currently investigating these allegations and offering free consultations to affected clients.
According to the information available on Tammy Paquette’s FINRA CRD, the customer dispute was filed on February 8, 2024, and is currently pending resolution. Paquette has been registered with LPL Financial LLC (CRD 6413) in Arizona since April 19, 2012, and maintains her status as both a broker and an investment advisor.
In response to the allegations, Tammy Paquette has denied any wrongdoing, stating, “I deny all allegations of wrongdoing and the claims are without merit. All recommendations and investment strategies made for the customers were suitable and consistent with the customers’ investment objectives and risk tolerances. The customers fully understood all risks involved in investing in all products after speaking with me and reviewing the documentation.”
Understanding unsuitable investment recommendations and FINRA Rule 2111
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Unsuitable investment recommendations occur when a broker or investment advisor recommends an investment that is not appropriate for a customer’s financial situation, investment objectives, or risk tolerance. FINRA Rule 2111, known as the “Suitability Rule,” requires brokers to have a reasonable basis for believing that a recommended transaction or investment strategy is suitable for the customer based on their investment profile.
An investment profile includes factors such as the customer’s age, financial situation, investment experience, investment objectives, liquidity needs, risk tolerance, and any other relevant information the customer may disclose to the broker. By making unsuitable recommendations, brokers and investment advisors can expose their clients to unnecessary financial risks and losses.
The importance of suitable investments for investors
Suitable investment recommendations are crucial for investors, as they help ensure that their financial goals and risk tolerance are properly aligned with their investment portfolio. When brokers or investment advisors make unsuitable recommendations, investors may find themselves in situations where they are exposed to more risk than they are comfortable with or where their investments do not perform as expected.
Unsuitable investments can lead to significant financial losses, which can have a lasting impact on an investor’s financial well-being and ability to achieve their long-term goals. By working with brokers and investment advisors who prioritize suitability and adhere to FINRA rules, investors can better protect their financial interests and make informed decisions about their investments.
Recognizing red flags and seeking help for financial advisor malpractice
Investors should be aware of potential red flags that may indicate financial advisor malpractice, such as:
- Recommendations that seem too good to be true or promise guaranteed returns
- Pressure to make quick investment decisions without sufficient time to review the risks and potential outcomes
- Lack of transparency about fees, commissions, or potential conflicts of interest
- Investments that do not align with the investor’s stated goals, risk tolerance, or financial situation
If an investor suspects that they have been the victim of unsuitable investment recommendations or other forms of financial advisor malpractice, they may be able to recover their losses through FINRA arbitration. Haselkorn & Thibaut, with offices in Florida, New York, North Carolina, Arizona, and Texas, has over 50 years of experience helping investors recover losses caused by investment fraud and misconduct.
With a 98% success rate and a “No Recovery, No Fee” policy, Haselkorn & Thibaut is committed to fighting for investors’ rights and helping them navigate the complex legal process. Investors who believe they may have a case can contact the firm for a free consultation by calling their toll-free number at 1-888-885-7162 .
