How Investors Can Sue LPL Financial LLC Financial Advisor Charles Fackrell
Posted on Monday, April 17th, 2017 at 2:02 pm
Erez Law is currently investigating LPL Financial LLC financial advisor Charles Caleb Fackrell (CRD# 5369665) regarding securities fraud and involvement in a $1.4 million Ponzi scheme. A Ponzi scheme is a form of fraud in which belief in the success of a nonexistent enterprise is fostered by the payment of quick returns to the first investors from money invested by later investors.
Fackrell was registered with LPL Financial in Yadkinville, North Carolina from 2010 to 2014. In December 2014, Fackrell was terminated from employment at LPL Financial based on allegations that he participated in unapproved private securities transactions and his felony arrest that same month for obtaining property under false pretenses.
In February 2015, FINRA barred Fackrell regarding findings that he is alleged to convert customer funds and sold private securities offerings away from LPL Financial without the firm’s knowledge or approval. According to a release by the Department of Justice in April 2016, Fackrell pled guilty to securities fraud and he was sentenced to five years in prison. Fackrell solicited $1.4 million from at least 20 investors in a Ponzi scheme involving investments with Robin Hood, LLC,” “Robinhood LLC,” “Robin Hood Holdings, LLC,” “Robinhood Holdings, LLC” and related entities, all of which were entities that Fackrell controlled and had access to the funds. Fackrell misled investors into believing that the Robin Hood investments were safe and secured by gold and other precious metals, with a guaranteed annual return of 5 to 7%. Also instead of investing the funds, Fackrell used most of the funds for personal use, including medical bills, groceries, hotel expenses, shopping sprees and to make large cash withdrawals. Fackrell also used a portion of the money to make “interest” payments to some investors who demanded their money back by generating further investments from the other existing investors. Fackrell was able to divert about half of the money he received from investors to other investors, continuing the Ponzi scheme.
Fackrell was sentenced to 63 month in prison and an additional three additional years under court supervision after his release from prison, and he was ordered to pay back $820,000 in restitution to his former clients.
Fackrell has been the subject of 11 customer complaints between 2014 and 2016, according to his CRD report:
November 2016. “Claimants allege selling away, forgery, unsuitability and misrepresentation. Activity period June 2010 to December 2014.” The case is currently pending.
June 2016. “Claimants allege unsuitability, misrepresentation, excessive and unauthorized trading, and use of client funds for his personal benefit. Activity period August 2010 to December 2014.” The case is currently pending.
March 2016. “Claimants alleges selling away, unsuitability and misrepresentation. Activity period june 2010 to december 2014.” The case is currently pending.
February 2016. “Claimants allege selling away, forgery, unsuitability and misrepresentation. Activity period June 2010 to December 2014.” The case is currently pending.
January 2016. “Claimant alleges unauthorized trading and unsuitability of investments.” The case was settled for $18,500.
August 2015. “Claimants allege unsuitable investments and misrepresentation. Also allege that the fa placed them in investments that are unapproved by lpl which they believe were illegitimate.” The case is currently pending.
July 2015. “Claimants allege unsuitable investments and misrepresentation. Also allege misappropriation of funds through transactions not made through or approved by LPL.” The customer was awarded $119,177 in damages.
June 2015. “Customer alleges that the investments in the account were unsuitable.” The customer sought $10,235 in damages but the case was closed without action.
June 2015. “Violation of securities regulatory requirements; breach of fiduciary duties; violation of the Washington State Securities Act and the Utah Uniform Securities Act; negligence; negligent supervision; violation of the Washington Consumer Protection Act.” The case was settled for $67,966.46.”
February 2015. “Customer alleges misrepresentation.” The case was closed without action.
December 2014. “Customers allege unsuitability and poor performance of investments in their accounts. Customers also allege that the fa placed them in an investment unapproved by LPL.” The customer sought $170,000 in damages but the case was closed without action.
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, LPL Financial LLC may be liable for investment or other losses suffered by Fackrell’s customers.
Erez Law represents investors in the United States for claims against LPL Financial LLC financial advisor Charles Caleb Fackrell, who was charged with securities fraud regarding unapproved outside activities. If you were a client of LPL Financial LLC financial advisor Charles Caleb Fackrell or another firm, 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.