FINRA Suspends Todd Anderson for Alleged Unsuitable Recommendations
Todd Anderson (CRD #: 1896352), a broker formerly registered with Benchmark Investments, was recently suspended by FINRA, according to his BrokerCheck record, accessed on May 17, 2023. If you have questions about his alleged conduct as a broker, read on.
FINRA Suspension
On April 20, 2023, Todd Anderson consented to the entry of findings that he allegedly recommended that a senior client purchase over $1 million in mutual funds across 31 fund families without considering the availability of fee discounts that would have been available if they invested in fewer fund families.
According to a Letter of Acceptance, Waiver & Consent (AWC), Todd Anderson allegedly recommended that this client invest in 34 mutual funds across 31 different fund families from April 2014 through September 2019.
Each of the funds allegedly offered volume discounts on sales fees, with the degree of discount increasing as the size of the investment reached certain “breakpoint” levels set by the fund.
These breakpoints could allegedly be reached through a single investment or through “rights of accumulation,” under which new investments would be added to the existing holdings within the fund family.
The AWC alleges that Todd Anderson failed to consider that his client could have received a sales fee discount by reaching higher breakpoint levels, including through rights of accumulation, if the client had purchased funds in fewer fund families. The client allegedly incurred $20,867 in unnecessary sales charges.
The AWC concludes that these allegations constitute violations of FINRA Rules 2111 and 2010.
FINRA Rule 2111
FINRA Rule 2111 requires brokers to tailor their investment recommendations to suit investors’ profiles. These profiles describe an investor’s age, risk tolerance, and other characteristics.
Investors who rely on brokers for recommendations may be able to recover their losses through FINRA arbitration.
FINRA Rule 2010
FINRA Rule 2010 holds brokers to high standards of commercial honor and just and equitable principles of trade.
Sanctions
Todd Anderson consented to the following sanctions:
- $5,000 fine
- 45-day suspension
- Restitution of $20,867 plus interest
His suspension began on May 15, 2023, and will end on June 28, 2023.
You can read the full AWC here.
Tax Liens
From 2017-2022, Todd Anderson incurred a total of $1,505,215.83 in tax liens.
Termination from Cetera Advisors
On September 6, 2019, Todd Anderson was fired from Cetera Advisors following allegations that he executed an unauthorized trade, failed to follow the firm’s written instruction to obtain pre-approval for all mutual fund purchases, and failed to receive pre-approval for outside business activities.
FINRA Rule 3260
FINRA Rule 3260 requires brokers to receive written authorization from their clients before engaging in discretionary trading. Discretionary accounts must also be approved by the firm before this trading can occur.
FINRA Rule 3270
FINRA Rule 3270 requires brokers to seek and receive approval from their firm for any outside business activities they engage in.
Other Business Activities
Todd Anderson’s detailed BrokerCheck report lists the following outside business activities:
- Managing partner at Anderson Financial Group, an investment advisory firm.
- Partner at Thompson Anderson Restaurant LLC (dba Nook Restaurant), providing consulting.
- Insurance agent with various unspecified companies, selling fixed insurance products.
- Junior varsity soccer coach at Rincor High School in Tucson, Arizona.
Background Information
Todd Anderson 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 7 – General Securities Representative Examination
- Series 6 – Investment Company Products/Variable Contracts Representative Examination
He previously worked for the following firms:
- Benchmark Investments (CRD#:103792)
- Cetera Advisors (CRD#:10299)
- Geneos Wealth Management (CRD#:120894)
- Hornor, Townsend & Kent (CRD#:4031)
- NYLIFE Securities (CRD#:5167)
- MetLife Securities (CRD#:14251)
- Metropolitan Life Insurance Company (CRD#:4095)
Kurta Law Can Help
If you worked with Todd Anderson 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.
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