In September 2019, a former client of UBS Financial Services and broker William Hightower (CRD# 2152369) won a FINRA arbitration $555,000 in damages resulting from unsuitable investment recommendations.
According to Hightower’s BrokerCheck, the allegations were regarding, “Allegations: Plaintiffs allege that Hightower sold her inappropriate investments, including a principal protected note, an alternative private investment, and a private annuity, some of which were part of a ponzi scheme by which he stole plaintiff’s money.”
The causes of action included: breach of contract and warranties, promissory estoppel, unfair trade and deceptive practices, violation of Texas securities statutes, violation of Texas fraud statutes, intentional and negligent misrepresentations of fact, unjust enrichment, breach of fiduciary duty, and vicarious liability. The causes of action relate to Claimants’ allegation that Respondent, through its employee, sold unsuitable investments to Claimants that resulted in significant losses, including private placement investments in Isospec Technologies, LP and Reproductive Research Technologies, LP and a “private annuity” issued by Respondent’s employee. Claimants further allege that one or both of the private placements were Ponzi schemes and the money intended for a “private annuity” was stolen. The FINRA arbitration hearing was conducted in Houston, Texas.
The customer’s complaint against his member firm that asserted the following causes of action:
Hightower was a subject of the customer’s complaint alleging he and his member firm caused sales practice violations. UBS Financial Services is liable for and shall pay to claimants the sum of $530,000.00 in compensatory damages and is liable for and shall pay to claimants the sum of $25,000.00 in costs.
Hightower was registered UBS Financial Services Inc. in Houston, Texas from 2007 to 2013 and most recently with Legacy Asset Securities, Inc. in Houston, Texas from 2013 to 2015. Hightower is no longer registered with any brokerage firm and has been barred from acting as a broker by FINRA.
In October 2015, “Hightower consented to the sanction and to the entry of findings that he failed to respond fully to a request for documents and information made by FINRA in connection with an investigation into allegations that Hightower, while associated with a FINRA member firm, improperly referred customers to an unapproved private securities transaction. Specifically, Hightower failed to provide, among other things, a list of any customers he referred to the private securities transaction,” according to the Acceptance, Waiver & Consent document. Based on these findings, FINRA barred Hightower from acting as a broker or otherwise associating with firms that sell securities to the public.
Hightower has been the subject of six additional customer complaints between 2015 and 2019, according to his CRD report.
April 2019. “Time frame: NOT SPECIFIED Allegations: Claimants allege the FA liquidated their accounts without authorization and used the money to purchase shares in his company.” The case is currently pending.
March 2019. “Time frame: 6/2007 to 10/2015 Allegations: Plaintiffs alleges that at UBS and a subsequent employer Hightower recommended inappropriate investments including a “private annuity” and stock in a company Hightower controlled and that he liquidated positions and transferred funds to his company without authorization.” The customer is seeking $1 million in this pending customer complaint.
March 2016. “Claimant alleges that FA recommended the purchase of a high risk, illiquid and unsuitable unregistered security. Claimant further alleges omissions and misrepresentations regarding this recommended investment.” The customer sought $150,000 in damages and the case was settled for $125,000.
May 2015. “Time frame: 2009-2013 The claimants council (sp) alleges unsuitability of investments, misrepresentations and unauthorized trading in accounts.” The claims brought against UBS and Hightower included: negligent management and supervision of accounts, violation of FINRA Rule 2090, violation of FINRA Rule 2111, violation of FINRA Rule 2020, violation of FINRA Rule 2262, violation of Texas Securities Act Section 4.F, breach of contract, violation of Texas Human Recourses Code Section 102.003(b)(2), violation of Texas Deceptive Trade Practices Act Sections 17.46(b)(3) and 17.46(b)(24), breach of fiduciary duty, and violation of FINRA Rule 2010. Claimants alleged that Respondents recommended various highly speculative and unsuitable investments, including Reproductive Research Technologies and IsoSpec Technologies. The former client alleged that these investments were unsuitable given their age and financial position. The claimant sought $1 million in damages and the case was settled for $40,000.
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, UBS Financial Services and Legacy Asset Securities, Inc. may be liable for investment or other losses suffered by William Andrew Hightower’s customers.
Erez Law represents investors in the United States for claims against brokers and brokerage firms for wrongdoing. If and 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.