Investors Accuse Kovack Of Mutual Fund Misconduct
Jeffrey Paul Davis of Bristol Connecticut a stockbroker currently registered with Kovack Securities Inc. is the subject of a customer initiated investment related written complaint on June 10, 2019 in which the customer requested more than $5,000.00 in damages based upon accusations that (1) the customer was placed into inappropriate investments including mutual funds and real estate investment trust products and (2) the customer’s account was overconcentrated in unsuitable products during the time that Davis was associated with Kovack Securities Inc.
Financial Industry Regulatory Authority (FINRA) Public Disclosure reveals that Davis is referenced in nine additional customer initiated investment related disputes containing allegations of his violative conduct while he was employed with securities broker dealers including Harvest Capital LLC, National Planning Corporation, and Invest Financial Corporation. Specifically, a customer initiated investment related complaint involving Davis’ conduct was settled for $41,258.38 in damages supported by accusations of omissions concerning the length of time that the customer was required to invest, and nondisclosures concerning risks of the investments.
Davis is referenced in another customer initiated investment related civil action brought in the Superior Court of Connecticut which was resolved for $35,000.00 in damages founded on allegations that unfounded statements had been made concerning the terms and conditions of investments sold to the customer when Davis was employed by National Planning Corporation. Also, a customer filed an investment related complaint in regard to Davis’ behavior where the customer sought $79,000.00 in damages based upon accusations of fraudulent real estate investment trusts which led the customer to experience losses.
FINRA Public Disclosure additionally confirms that Davis has been fined $5,000.00 and suspended from associating with any FINRA member in any capacity based upon consenting to findings that he gave bad investment recommendations to customers and excessively concentrated their assets in illiquid real estate investment trust products. Letter of Acceptance Waiver and Consent No. 2013039456301 (Apr. 5, 2017).
According to the AWC, by acting on Davis’ unsuitable investment recommendations, three Harvest customers placed $566,000.00 into non-traded real estate investment trusts. Between thirty and fifty-two percent of the customers’ liquid net worth had been tied up in these investments. FINRA determined that the excessive purchases were not suitable given the customers’ circumstances, objectives for investing and tolerance for risk. Davis’ conduct was found by FINRA to be violative of FINRA Rules 2010, 2110 and National Association of Securities Dealers (NASD) Rules 2110 and 2310.