Richard Shaw Involved in Two Pending Unsuitability Disputes
Richard Shaw (CRD #: 1870018), a broker and investment advisor registered with Lincoln Financial Advisors Corporation, is facing two pending unsuitability disputes, according to his BrokerCheck record, accessed on March 26, 2022.
Investor Allegations
In 2022, Richard Shaw was named in two investor disputes alleging unsuitable investment recommendations.
On February 28, 2022, investors alleged that Richard Shaw recommended unsuitable oil and gas REIT investments. Oil and gas investments are always high risk and are not suitable for most investors.
On February 7, 2022, an investor alleged that Richard shaw recommended two unsuitable investments.
FINRA Rule 2111
A financial advisor who recommends investments is subject to ethical standards enforced by FINRA. FINRA Rule 2111 requires registered financial advisors to have a “reasonable basis” to believe that a recommended transaction or investment strategy suits their client’s needs.
FINRA has three requirements for suitable investments: 1) Reasonable-basis suitability, 2) customer-specific suitability, and 3) quantitative suitability.
- Reasonable-basis Suitability: Brokers are required to use reasonable diligence before making a recommendation. They have an obligation to understand an investment strategy and its potential risks or rewards.
- Customer-specific Suitability: Before recommending a particular security or investment strategy, brokers are required to have reasonable grounds for believing it will be suitable based on that client’s personal profile. The profile includes information on the investor’s financial goals, investing experience, and risk tolerance.
- Quantitative Suitability: Brokers with control over a customer’s account must have a reasonable basis to believe that the series of transactions they recommend are not excessive before executing them. Excessive transactions run the risk of incurring too many fees and negating any returns.
If you’ve lost money due to a financial advisor’s bad recommendations, do not hesitate to contact an experienced securities attorney as soon as possible. Kurta Law is a nationally recognized securities law firm with over 25 years of experience litigating securities fraud cases.
Kansas Insurance Department Regulatory Disclosure
On October 11, 2020, the Kansas Insurance Department suspended Richard Shaw’s Life, Heath, Variable insurance license for 16 days following an alleged failure to pay a renewal fee.
Background Information
Richard Shaw has passed the following exams:
- Series 65 – Uniform Investment Adviser Law Examination
- Series 63 – Uniform Securities Agent State Law Examination
- SIE – Securities Industry Essentials Examination
- Series 22 – Direct Participation Programs Representative Examination
- Series 6 – Investment Company Products/Variable Contracts Representative Examination
Richard Shaw is a registered broker in 16 states. He is also a registered investment advisor in Texas, Oklahoma, and Kansas.
Besides Lincoln Financial Advisors Corporation, Richard Shaw has also worked with the Lincoln National Life Insurance Company (CRD#:2580) and Cigna Financial Advisors (CRD#:145).
Kurta Law Can Help
If you have worked with Richard Shaw and 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.