Timothy Bassett Involved in a Dispute Regarding an Unsuitable Closed-end Fund and BDC 

Timothy Bassett (CRD #:5397271), a broker and investment advisor registered with Morgan Stanley, is the subject of a dispute involving an unsuitable closed-end fund and a Business Development Corporation (BDC), according to his BrokerCheck record, accessed on April 12, 2022. 

According to the allegations filed on February 1, 2022, Timothy Bassett recommended a closed-end fund and a business development company that were unsuitable for the customer’s risk tolerance and investment objectives. The investor is seeking $160,000一the case is still pending.

Closed-end Funds and BDCs

What is A Closed-end Fund?

A closed-end fund is a mutual fund that enables portfolio managers to raise funds via an initial public offering (IPO).

Investors should be cautious of closed-end funds because they are often complex. If your broker recommended that you buy shares of a closed-end fund but failed to adequately explain the risks, a securities attorney may be able to assist you in recouping your losses.

What are BDCs?

FINRA defines a Business Development Company (BDC) as a domestic, closed-end investment company that is operated for the purpose of making equity and debt investments in small and developing businesses, as well as financially troubled businesses. BDCs can be speculative investments that involve significant risks. As a result, BDC investments may not be suitable for all investors.

FINRA Rule 2111

Brokers must consider the factors listed below when recommending investments to investors:

• The investor’s current financial state and tax status 
• The investor’s financial goals  
• The investor’s risk tolerance 

According to FINRA Rule 2111, brokers may be liable for investor unsuitability claims if they fail to consider the factors listed above. A broker must have exercised due diligence and have an adequate reason for believing that an investment will be suitable or beneficial for the investor.  

Background Information

Timothy Bassett has passed the following exams:

• Series 66 – Uniform Combined State Law Examination
• SIE – Securities Industry Essentials Examination
• Series 31 – Futures Managed Funds Examination
• Series 7 – General Securities Representative Examination
• Series 9 – General Securities Sales Supervisor – Options Module Examination

Timothy Bassett is a registered broker in 50 states, Washington DC, the Virgin Islands, and Puerto Rico. He is also a registered investment adviser in Illinois, Michigan, and Texas.

Besides Morgan Stanley, Timothy Bassett has also worked with LPL Financial (CRD#:6413).

Kurta Law Can Help

If you have worked with Timothy Bassett 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.