Erez Law continues to investigate claims related to Paul V. Blum (CRD # 735003), a West Palm Beach, Florida, broker who was registered with RBC Capital Markets, LLC, from October 2008 until October 2015. Blum currently is not registered with any firm. Erez Law recently filed a FINRA arbitration claim on behalf of one of Blum’s former clients, who alleges that he has experienced significant investment losses stemming from Blum’s unsuitable recommendation to make concentrated investments in oil and gas including Swift Energy Co., Basic Energy Services, Inc., Alpha Natural Resources, and RRI Energy.
In addition, Blum recently has been the subject of several customer complaints, according to his CRD:
- February 2016: “Client claims that he was unaware of his stated investment objective and risk tolerance and that his financial advisor never informed him of the risk of his portfolio. Time frame is approximately 5/2013 to 1/2016.” The customer seeks unspecified damages.
- February 2016: “On behalf of clients, attorney claims that their accounts were handled on a discretionary basis and that the risk of their portfolio was disregarded.” The customer seeks damages of $375,000.
- February 2016: “Clients allege the financial advisor recommended unsuitable and over-concentrated investments in the energy sector, in period 12/2009 to 12/2015.” The customer seeks damages of $886,070.00.
- January 2016: “Client alleges that her financial advisor told her that “B” taxable bonds were the same as “A” tax free bonds. She is not happy with her investments and wants to know if the firm will do anything to help her.” The claim was settled for $150,000.
- December 2015: “Client complains that her financial advisor was negligent in recommending the purchase of bonds which have since defaulted. Time frame is Feb 2009 to Apr 2014.” The customer seeks damages of $450,000.
- November 2015: “Customer claims that high yield bonds were purchased for his account without prior consultation. He requests that the firm buy back particular bonds he purchased between May 2013 and May 2014 at his original purchase price.” The customer seeks damages of $133,000.
In addition, Blum’s CRD shows five older complaints dating from 1995-2012.
A broker must have reasonable grounds for each recommendation made to investors considering such factors as the customer’s other securities holdings, financial situation, and risk tolerance. In addition, before a firm offers a security to its customers, the firm must conduct due diligence, that is investigate the facts surrounding the security, to confirm that it is suitable for any customer of the firm. The suitability of an investment for a particular individual is at the center of the investment process and one of the key fiduciary duties owed by a firm and its broker to the customer. A firm may be held liable for its failure to recommend suitable investments to its customers.
In addition, 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, RBC Capital Markets, LLC, may be liable for investment or other losses suffered by Turner’s customers.
If you were a client of RBC Capital Markets, LLC, or Paul Blum, and have experienced investment losses or financial irregularities, please call us at 888-840-1571 or complete our “contact form.” Erez Law is a nationally recognized law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies.