Christopher Passero Allegedly Made Misrepresentations and Omissions
Christopher Passero (CRD #: 2517681), a broker registered with Money Concepts Capital, is involved in a pending dispute, according to his BrokerCheck record, accessed on July 10, 2023. Investors may have also engaged his services through Money Concepts Advisory Service.
On May 1, 2023, an investor alleged that Christopher Passero engaged in misconduct involving unsuitability, misrepresentation, and the omission of material information related to the sale of GPB Capital Holdings investments. The client seeks $250,000 in this pending dispute.
On March 26, 2020, multiple investors filed a dispute naming Christopher Passero in allegations of the following:
- Civil conspiracy
- Misrepresentation and omission of facts
- Unsuitable investments
- Gross negligence and other negligence
The clients further claimed that these allegations concerned their goals to protect and grow their savings and to receive monthly distributions of their savings and earnings. This dispute was settled for $90,000.
FINRA Rule 2111
FINRA Rule 2111 requires brokers to take into account investors’ financial goals when recommending investments. Brokers must examine the information contained in an investor’s profile, such as their tax status, risk tolerance, and overall financial situation.
Investors who rely on their broker for recommendations may be able to recoup their losses through FINRA arbitration.
FINRA Rule 2020
The misrepresentation and omission of information related to investments violate FINRA Rule 2020, which bans the use of manipulation, deception, and other fraudulent tactics to influence the purchase and sale of securities.
FINRA Rule 2010
FINRA Rule 2010 holds brokers to high standards of commercial honor and just and equitable principles of trade.
Maryland Regulatory Action
On July 7, 2022, the State of Maryland revoked Christopher Passero’s registration as a broker for allegedly failing to respond to an Order to Show Cause.
On April 11, 2022, Christopher Passero consented to the entry of findings that he allegedly shared in his clients’ losses by compensating them for losses associated with investments he had recommended.
He allegedly also made a loan to a client without the authorization of his firm, Money Capital Concepts.
Alleged Sharing in Clients’ Losses
According to a Letter of Acceptance, Waiver & Consent (AWC), Christopher Passero allegedly recommended a real estate investment trust (REIT A) to many of his clients between 2006 and 2008.
In 2010, REIT A allegedly re-stated its value, resulting in a decline in share price and a reduction in the monthly dividends it paid to customers. It allegedly made its final cash distribution in August 2018.
The AWC alleged that many of Christopher Passero’s clients experienced losses on their REIT A investments despite the distributions and dividends they received. However, Chris Passero allegedly began making payments to some of his clients following REIT A’s 2010 re-statement in value and continued these payments through February 2020.
During this time, he allegedly made 990 payments totaling $249,560 to nine clients invested in REIT A as compensation for the reduction in monthly dividends. This allegedly violated Money Capital Concepts’ written supervisory procedures (WSPs). Christopher Passero allegedly did not inform his firm or seek authorization for these payments.
Further, from 2010-2020, Christopher Passero allegedly falsely stated on firm compliance questionnaires that he did not share directly or indirectly in clients’ losses.
The AWC alleged that this misconduct violated FINRA Rules 2150(c) and 2010.
Alleged Loan to Firm Client
In May 2015, Christopher Passero allegedly loaned $10,000 to a client in order to assist them in paying a tax liability. Money Capital Concepts’ WSPs allegedly prohibited brokers from loaning money to clients without prior authorization, which Christopher Passero allegedly failed to seek out.
Further, he allegedly falsely stated on a 2015 compliance questionnaire that he did not loan money to clients.
The AWC concluded that this alleged loan violated FINRA Rules 3240 and 2010.
FINRA Rule 2150
FINRA Rule 2150(c) forbids brokers from sharing directly or indirectly in the profits or losses in the account of a client without authorization from both their firm and the client.
FINRA Rule 3240
FINRA Rule 3240 describes the circumstances under which brokers may borrow from or lend to clients, such as loans between immediate family members.
Christopher Passero consented to the following sanctions:
- $10,000 fine
- 3-month suspension
His suspension ran from May 2 to August 1, 2022.
You can read the full AWC here.
Christopher Passero Background Information
Christopher Passero 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 6 – Investment Company Products/Variable Contracts Representative Examination
Christopher Passero is a registered broker in 12 states. He is a registered investment adviser in West Virginia.
He has also worked with Emissary Financial Group (CRD#:44568).
Kurta Law Can Help
If you have worked with Christopher Passero and have concerns about your investments, don’t hesitate to contact us today at 877-600-0098 or email@example.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.