Erez Law recently filed a FINRA arbitration claim against Centaurus Financial, Inc. broker Cindy Chiellini (CRD #1015592), who is accused of recommending the unsuitable GWG Holdings, Inc. L Bonds. Cindy Chiellini has been registered with Centaurus Financial, Inc. in Lexington, South Carolina since May 2015.
The Erez Law clients allege the following in the newly filed FINRA claim:
The clients were a retired couple that were inexperienced investors with a moderately conservative investment threshold that were looking to generate moderate-income to provide for their living expenses during retirement while preserving their capital. They entrusted Cindy Chiellini and Centaurus Financial, Inc. with their irreplaceable retirement savings.
Although GWG Holdings, Inc. L Bonds were marketed as and recommended by Cindy Chiellini and Centaurus Financial, Inc. to the couple as a safe investment offering guaranteed return of principal upon redemption, plus interest, in reality, the L Bonds were non-conventional, unrated, illiquid private placement investments that were inherently high risk.
It is alleged that Cindy Chiellini employed a speculative and unsuitable investment strategy of dangerously concentrating the couple’s portfolio in a single illiquid investment, GWG Holdings, Inc. L Bonds that produced unacceptable and avoidable results. In fact, the couple’s investment in the L Bonds represented nearly 95% of the assets they entrusted to Cindy Chiellini and Centaurus Financial, Inc. Cindy Chiellini’s recommendation that the couple dangerously concentrates their portfolio in a single speculative and illiquid private placement investments was highly unsuitable given the couple’s objectives.
According to the claim, the L Bonds Cindy Chiellini recommended and sold to the couple paid Cindy Chiellini significant commissions, upwards of 5% of the bond’s market price.
Erez Law alleges that Cindy Chiellini failed to adequately describe the nature of the L Bonds, nor did she disclose the true risks attendant to the same. As part of her solicitation, Cindy Chiellini merely represented to the clients that the L Bonds were a safe investment in which to generate a good yield while preserving his principal which would be returned upon maturity and redemption of the L Bonds.
It is alleged that Cindy Chiellini failed to adequately disclose the enormous degree of risk, including liquidity risk and concentration risk, associated with the reckless investment strategy she employed in the couple’s portfolio. By failing to adequately disclose the enormous risks associated with his reckless investment strategy, Cindy Chiellini deprived the couple of their fundamental right to make an informed decision about their investments.
According to the claim, at no point did Cindy Chiellini disclose any of the risks associated with an investment in the high-risk and unsuitable L Bonds. More importantly, Cindy Chiellini never informed the couple that the interest payments they relied upon for their living expenses during retirement could cease or that their entire investment could be lost altogether.
How to File a Claim Against Cindy Chiellini
Erez Law represents investors in the United States for claims against brokers and brokerage firms for wrongdoing. If you have experienced investment losses, please call us at 888-840-1571 or complete our contact form for a free consultation. Erez Law is a nationally recognized law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies on a contingency fee basis.
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