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Investor Alleges Charles Castro Misrepresented Investments

Nov 16, 2021 Investor Disputes

Charles Castro (CRD #:5556780), a registered broker with David Lerner Associates, is involved in an investor dispute, according to his BrokerCheck record, accessed on October 27, 2021. The investor is seeking six figures. 

Investor Allegations

On September 28, 2021, an investor filed a dispute against Charles Castro.  The allegations include unsuitability and misrepresentation. The investor is requesting a settlement of $235,000.00. The dispute is still pending. 

Allegations are a Violation of FINRA Rule 2020, 2011, and 2010

FINRA Rule 2020 - Misrepresentation

FINRA Rule 2020 prohibits brokerage firms and stockbrokers from making material misrepresentations of fact to induce an investor in connection with the sale or purchase of an investment. Misrepresentation also violates The Securities Act of 1933, which prohibits deceit, misrepresentation, and other fraud in the sale of securities. 

FINRA Rule 2111 - Suitability

FINRA Rule 2111 defines suitable investments as securities that fit an investor's profile. An investor's profile includes information about their risk tolerance, financial goals, and age. 

  • Investments can be unsuitable because they are high risk and likely to lose money.
  • Securities may also be unsuitable because they are illiquid, meaning that they are intended to be held for an extended time, and investors may have to pay high fees to cash out.
  • Securities can be quantitatively unsuitable, which means that brokers executed an excessive number of trades.
  • These requirements apply to the overall investment strategy as well as the investments themselves. For instance, an investment strategy might be unsuitable if the securities are over-concentrated in a particular stock or sector.

Brokers are required to have a reasonable basis for recommending an investment according to FINRA Rule 2111. Investors who rely on their brokers for recommendations may be able to recover their losses through FINRA arbitration.

FINRA Rule 2010

Charles Castro’s alleged conduct is also unethical and is a violation of FINRA Rule 2010 which states the brokers must uphold the highest standards of commercial honor.

Charles Castro Background Information

Charles Castro has passed the following exams:

  • Series 63 - Uniform Securities Agent State Law Examination
  • SIE - Securities Industry Essentials Examination
  • Series 7 - General Securities Representative Examination
  • Series 53 - Municipal Securities Principal Examination
  • Series 24 - General Securities Principal Examination

He is a registered broker in 11 states. 

Kurta Law Can Help

If you have worked with Charles Castro and you have concerns about your investments, don't hesitate to contact us today at 877-600-0098 or info@kurtalawfirm.com for a free consultation.

For nearly 20 years, Kurta Law has advocated for investors to recover their investment losses from brokers and brokerage firms. Kurta Law is a nationally recognized law firm and exclusively represents investors against brokers and brokerage firms on a contingency basis. This means that the firm only earns a fee if our securities attorneys recover money on your behalf. Please contact us today if you would like us to evaluate your potential case.