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Lee Wells Allegedly Made Unsuitable Investment Recommendation

Lee Wells (CRD #: 6166726), a broker registered with Merrill Lynch, Pierce, Fenner & Smith, was involved in a recent dispute, according to his BrokerCheck record, accessed on August 7, 2022. If you have questions about Lee Wells’s conduct as a broker, read on.

Investor Dispute

On May 24, 2022, an investor alleged that Lee Wells recommended an unsuitable investment. This dispute was denied by the firm.

Investors should be aware that firms can deny disputes without allowing an outside review. Investors may still be able to recover their funds by pursuing FINRA arbitration after a denial.

FINRA Rule 2111

FINRA Rule 2111 requires brokers to evaluate whether an investment fits their investor’s financial goals. Brokers must take into account the characteristics described in their investor’s profile, including their age, tax status, and other investments.

Some common violations of this rule include:

  • Recommendations of high-risk or illiquid investments. These investments may lead to losses or penalize the investor with high fees.
  • Excessive trading, which violates the need for quantitative suitability. This means that the broker executed an excessive number of trades, leading to high fees and commissions.
  • Recommendations of unsuitable investment strategies. For instance, overconcentration of securities in a certain stock or sector is often an unsuitable strategy due to the level of risk involved.

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

Background Information

Lee Wells has passed the following exams:

  • Series 66 – Uniform Combined State Law Examination
  • SIE – Securities Industry Essentials Examination
  • Series 7 – General Securities Representative Examination
  • Series 10 – General Securities Sales Supervisor – General Module Examination
  • Series 9 – General Securities Sales Supervisor – Options Module Examination

Lee Wells is a registered broker in 21 states and a registered investment adviser in Florida and Texas.

Kurta Law Can Help

If you worked with Lee Wells 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.