Erez Law is currently investigating McDermott Investment Services, LLC broker Dean McDermott (CRD# 1731834) regarding Delaware Statutory Trust (DST) losses. He has been registered with McDermott Investment Services, LLC in Bethlehem, Pennsylvania, since 2011, and McDermott Investment Advisors, LLC in Naples, Florida, since 2004.
In January 1998, the United States Securities and Exchange Commission (SEC) sanctioned him to a cease and desist injunction.
In September 2019, the SEC filed a complaint against the broker, McDermott Investment Advisors, LLC (MIA), and Relief Defendant McDermott Investment Services, LLC alleging that between March 2013 and December 2014, the broker and MIA, the investment adviser he owns, “unlawfully invested their clients in a version of a security that charged significant transactional sales charges when the identical security without these costs was available.” The complaint alleges that as investment advisers, they were paid a fee by their clients to choose investments and make trades on their clients’ behalf, and were “required to act in the best interests of their clients and place their interests before their own.” The SEC alleged that by “causing their clients to pay these avoidable fees, Defendants violated their fiduciary duty to seek best execution of these transactions on behalf of their clients.” Additionally, the SEC found that they “violated their fiduciary duty by failing to disclose to their clients the conflict of interest inherent in these transactions: namely, that a version of the securities without the transactional sales charges was available, and that the majority of the unnecessary transactional costs incurred by Defendants’ clients was paid to Relief Defendant MIS, McDermott’s 100%-owned and controlled broker-dealer. McDermott, MIA, and MIS were double dipping by receiving both the advisory fees and the fees generated by the more expensive securities.” He was sanctioned to pay a civil and administrative penalty and fine in the amount of $143,379.33.
Dean McDermott Customer Complaints
He has been the subject of one customer complaint, according to his CRD report:
March 2026. “Claimants, experienced real estate investors, purchased a Delaware Statutory Trust in August 2022, as part of a tax advantaged 1031 exchanges of their prior real estate investments. Due to circumstances well beyond broker-dealer’s control, the DST is not performing to Claimants’ expectations. Accordingly, Claimant has made various allegations and legal claims related to suitability and due diligence with respect to the DST. Allegations also include breach of fiduciary duty, negligence, misrepresentations and omissions, failure to supervise and breach of contract.” The customer is seeking $227,000 in damages, and the case is currently pending.
Pursuant to FINRA Rules, member firms are responsible for supervising a broker’s activities during the time the broker is registered with the firm. Therefore, McDermott Investment Services, LLC may be liable for investment or other losses suffered by Dean McDermott’s customers.
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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