Investor Alleges David LaGrange Engaged in Negligence

David LaGrange (CRD #: 4200976), a broker registered with Moloney Securities, allegedly engaged in negligent conduct. This disclosure appears in his BrokerCheck record, accessed on March 7, 2025. Investors may have also worked with him through Moloney Securities Asset Management. Keep reading for more details.

Investor Dispute

On December 31, 2024, an investor filed a dispute alleging that David LaGrange engaged in negligent conduct and violated the suitability rule in 2020. The client seeks $72,000 in damages in this pending dispute.

FINRA Rule 2111

FINRA Rule 2111 requires brokers to tailor their investment recommendations to suit investors’ profiles. These profiles contain information about investors’ risk tolerance, tax status, investment goals, and overall financial situation.

Investors who rely on brokers for recommendations may be able to recover their losses through FINRA arbitration.

SEC Regulatory Action

On September 27, 2024, the Securities and Exchange Commission instituted cease-and-desist proceedings against David LaGrange, Donald Hancock, Laura Barnes, and Moloney Securities.

The SEC alleged that the respondents failed to comply with Regulation Best Interest with regard to recommendations of GWG Holdings’ L Bonds between June 30, 2020, and approximately January 15, 2022.

During this period, GWG Holdings’ disclosures allegedly stated that L Bonds were speculative, involved a high degree of risk, and were suitable only for investors with no need for liquidity and significant financial resources.

In November 2021, GWG Holdings allegedly disclosed factors that raised substantial doubt as to its ability to continue as a going concern. David LaGrange and the other respondents allegedly continued to recommend L Bonds to investors despite this disclosure.

In particular, David LaGrange allegedly recommended L Bonds without a reasonable basis to believe were in the clients’ best interests given their profiles.

The SEC alleged that David LaGrange failed to comply with the Care Obligation and willfully violated the General Obligation of Regulation Best Interest.

What is Regulation Best Interest? 

Regulation Best Interest expanded on the requirements of FINRA Rule 2111, which defines suitable investment recommendations. In addition to limiting their recommendations to investments that suit their investors’ needs, brokerage firms must also uphold a Duty of Care, the Conflict of Interest Obligation, and the Disclosure Obligation.

These obligations and duties require brokerage firms to disclose conflicts of interest and, prior to recommending a security, research the market for investments that could offer similar benefits at a lower cost. 

Sanctions

The SEC ordered David LaGrange to cease and desist from violations of Regulation Best Interest and censured him.

The SEC also ordered the following sanctions:

• $12,500 civil penalty
• Disgorgement of $20,442
• Additional sanction of $2,848 

Background Information 

David LaGrange has passed the following exams: 

• Series 63 Uniform Securities Agent State Law Examination 
• SIE – Securities Industry Essentials Examination 
• Series 7 General Securities Representative Examination 

He is a registered broker in 23 states and the District of Columbia. He is also a registered investment adviser in Iowa. 

David LaGrange has registered with the following firms: 

• Moloney Investment Advisory (CRD #: 282140) 
• Moloney Securities Co. (CRD #: 38535) 
• Eagle One Investments (CRD #: 45254) 

Kurta Law Can Help

If you worked with David LaGrange and you have concerns about your investments, please contact us today at 877-600-0098 or info@kurtalawfirm.com for a free consultation.

For over 20 years, Kurta Law has advocated on behalf of investors who want 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.