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John Broughton Allegedly Recommended Unsuitable Business Development Company

John Broughton (CRD #: 2362478), a broker formerly registered with Citizens Securities, allegedly made unsuitable investment recommendations, according to his BrokerCheck record, accessed on June 30, 2022. Read on to learn more about John Broughton’s conduct as a broker.

Investor Disputes

On February 1, 2022, an investor alleged that John Broughton made an unsuitable recommendation to invest in and hold a closed-end fund and a Business Development Company. The client alleged that the recommendation did not suit his risk tolerance and investment objectives. He seeks $160,000 in damages in this pending dispute.

On July 16, 2020, an investor alleged that John Broughton misrepresented the interest she would receive from an annuity and the associated fees. This dispute was denied by the firm.

Investors should be aware, however, that firms can deny disputes without an external review. Investors may be able to recoup their losses following a denial by seeking out FINRA arbitration.

FINRA Rules 2111 and 2020

FINRA Rule 2111 requires brokers to evaluate investors’ profiles when recommending investments. Brokers must use the information contained in an investor’s profile, such as their age, tax status, and risk tolerance to ensure their recommendations suit their client’s goals.

FINRA Rule 2020 bans brokers from using manipulative, deceptive, and otherwise fraudulent methods to influence investors’ decisions. This includes the misrepresentation or omission of information related to investments, such as their risks, limitations, and fees.

What is a Business Development Company?

Business development companies (BDCs) allow retail investors to invest in the private sector. BDCs extend loans to small- to mid-sized companies in financial distress. However, the high degree of risk associated with BDCs makes them unsuitable for many investors.

Background Information

John Broughton has passed the following exams:

  • Series 66 – Uniform Combined State Law Examination
  • Series 63 – Uniform Securities Agent State Law Examination
  • SIE – Securities Industry Essentials Examination
  • Series 7 – General Securities Representative Examination
  • Series 24 – General Securities Principal Examination

He has also worked for the following firms:

  • Citizens Securities (CRD#:39550)
  • Cetera Investment Services (CRD#:15340)
  • LPL Financial LLC (CRD#:6413)
  • Primevest Financial Services (CRD#:15340)
  • Vision Investment Services (CRD#:46609)
  • First Tennessee Brokerage (CRD#:17117)
  • UVEST Financial Services Group (CRD#:13787)
  • Fifth Third Securities (CRD#:628)
  • Futureshare Financial (CRD#:47268)
  • Nathan & Lewis Securities (CRD#:8503)
  • BISYS Brokerage Services (CRD#:23302)
  • Natcity Investments (CRD#:17490)
  • Natcity Insurance Services (CRD#:16989)
  • American Express Financial Advisors (CRD#:6363)
  • IDS Life Insurance Company (CRD#:6321)

Kurta Law Can Help

If you worked with John Broughton and you have concerns about your investments, please contact us today at 877-600-0098 or 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.