The Texas State Securities Board has banned broker Mickey Long from recommending alternative investments, including nontraded REITs, after he concentrated a client’s account with too many such investments. The state also suspended him for forty-five days and put him on heightened supervision by his firm, Calton & Associates Inc., for two years.
[su_spacer size=”10″]Regulators have become increasingly concerned about high-commission products such as nontraded REITs over the past couple of years.
[su_spacer size=”10″]In this case, “[t]he agent recommended that a client invest in certain alternative investments, namely nontraded REITs and private offerings of interests in oil and gas entities,” according to Mickey Long’s central registration depository profile. “The client had elected within the client’s account opening documents to have no more than 20% allocated to the ‘highest risk/aggressive’ risk tolerance level and no more than 60% allocated to the ‘highest risk/moderate’ risk tolerance level.”
[su_spacer size=”10″]According to Texas’ order, Long put almost 36% of the customer’s invested assets into the former category and 78% into the latter, given some amount of overlap in the categories.
[su_spacer size=”10″]Long “did not have a reasonable basis to believe that the recommendations exceeding the client’s identified risk tolerance concentration levels were suitable for the client,” according to the CRD. “The unsuitable recommendations constituted inequitable practices in the sales of securities.”
[su_spacer size=”10″]Long joined Calton & Associates in June 2016. Before that, he was registered with VSR Financial Services Inc. for fourteen years. Owned by Cetera Financial Group, VSR, which was known for selling alternative investments, is being consolidated with another Cetera firm, Summit Brokerage Services Inc. Not all of the VSR brokers are being offered jobs with Summit.
[su_spacer size=”10″]If you or someone you know has lost money as a result of an investment or Ponzi scheme, please contact Richard Frankowski at 888-741-7503 to discuss your potential legal remedies or complete the contact form.
