Wells Fargo Broker Fined and Suspended by FINRA for Unsuitable Investment Recommendations
According to the Financial Industry Regulatory Authority (FINRA), Randall Layne Girton, of Orland Park Illinois, recommended that one of his Well Fargo customers purchase mutual fund shares and then, shortly thereafter, sold them to reinvest in a Wells Fargo investment advisory program, known as “Fund Source.” FINRA investigated and concluded that Mr. Girton’s recommendation that the customer sell her mutual fund share to invest in a Wells Fargo Proprietary Investment Advisory Program was an unsuitable investment recommendation, especially when he recommended several months after that the customer sell the Fund Source program and repurchase the mutual funds. FINRA Rule 2111(a) requires that registered representatives have a reasonable basis to believe that the recommended securities transactions are suitable in light of a particular customer’s investment objectives and financial condition. FINRA found that Mr. Girton’s recommendation that the Wells Fargo customer liquidate the Class A mutual fund shares that were part of a long term buy and hold investment strategy within months was unsuitable. According to FINRA, Mr. Girton had no basis to believe that the expected return on the Fund Source program would exceed the return on the mutual fund investment he previously recommended.
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