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Were You the Victim of Former Kestra Investment Services, LLC Broker Donald Padilla?

Posted on Wednesday, August 5th, 2020 at 8:30 pm    

Erez Law is currently investigating former Kestra Investment Services, LLC broker Donald Padilla (CRD# 3053711) regarding variable annuities investment losses. Padilla was registered with National Securities Corporation in Alhambra, California from April to September 2018. Previously, he was registered with Kestra Investment Services, LLC in Alhambra, California from 2015 to 2018, when he was terminated regarding, “Failure to follow firm policy, specifically in relation to correspondence requirements and marketing designations.” Prior to that, Padilla was registered with LPL Financial LLC in Alhambra, California from 2009 to 2015, when he was terminated regarding, “Representative resigned while the Firm was conducting a review of the use of an unapproved email address as well as the removal and/or concealment of such emails from office computers prior to an announced LPL Branch Exam.”

In June 2020, FINRA sanctioned Padilla to a $10,000 civil and administrative penalty and fine and suspended him for five months after he, “consented to the sanctions and to the entry of findings that he set up and used unapproved email accounts to correspond with his member firm’s customers about securities business and circumvented its supervision of his business. The findings stated that Padilla sent numerous electronic communications via the email accounts to firm customers regarding firm business such as, among other things, account funding confirmations, portfolio recommendations, fee summaries, and trade confirmations. Padilla hid the email accounts from the firm during branch audits. The findings also stated that Padilla caused the firm to fail to comply with its recordkeeping obligations by using the email accounts to conduct firm business which prevented it from preserving records of these communications. The findings also included that Padilla made misrepresentations on multiple firm annual compliance questionnaires indicating that he only used his firm email address for securities business and client-related correspondence.” 

In January 2020, FINRA suspended Padilla for an indefinite period of time regarding allegations that “Respondent Donald Padilla failed to comply with an arbitration award or settlement agreement or to satisfactorily respond to a FINRA request to provide information concerning the status of compliance.”

Padilla has been the subject of three customer complaints between 2007 and 2019, according to his CRD report:

August 2019. “Client’s son alleged that the firm’s client suffered from diminished capacity at the time she purchased a variable annuity during December 2016.” The customer is seeking $100,000 in damages and the case is currently pending. The complaint took place while Padilla was registered with Kestra Investment Services, LLC.

August 2019. “Client’s son alleged that the firm’s client suffered from diminished capacity at the time she purchases a variable annuity during December 2017.” The customer is seeking $154,700 in damages and the case is currently pending. The complaint took place while Padilla was registered with Kestra Investment Services, LLC.

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, Kestra Investment Services, LLC may be liable for investment or other losses suffered by Padilla’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.