Sigma Financial Corporation and Sigma Planning Corporation Client Wins $295,000 for Unsuitable Sales of ETFs
Posted on Thursday, May 25th, 2017 at 10:36 am
In February 2017, a former Sigma Financial Corporation and Sigma Planning Corporation client won an award in a FINRA arbitration for compensatory damages in the amount of $295,000 for unsuitable sales of leveraged exchange-traded funds (ETFs) and failure to execute a sale order for ETFs. The investor was a client of financial advisor Louis Frederick Scherschel (CRD# 5634741), a broker who was employed by Sigma Financial Corporation and Sigma Planning Corporation in Sleepy Hollow, Illinois between 2013 and 2015, before he was terminated after the allegations for failure to comply with the firm’s correspondence policy. Scherschel has been registered with St. Bernard Financial Services, Inc. in Russellville, Arkansas since 2015.
The former Sigma client claimed losses from Scherschel and Sigma for improper investing of the former customer’s retirement funds primarily in leveraged and inverse ETFs, which were risky and not suitable for the client’s investment objectives. ETFs are a marketable security that tracks an index, commodity, bonds or basket of assets, such as an index fund. ETFs trade like a common stock on the stock exchange, and they experience price changes as they are bought and sold throughout each day. They are an attractive alternative to mutual funds as they have higher daily liquidity and lower fees.
In the FINRA statement of claim, the legal claims that were brought against Scherschel and Sigma were for breach of fiduciary duty, violation of the Indiana Uniform Securities Act, violation of the Illinois Securities Act, breach of contract, violation of the Illinois Consumer Fraud and Deceptive Practices Act, violation of federal securities law, statutes, and regulations, negligent misrepresentation, negligence, fraudulent misrepresentation, failure to supervise, vicarious liability. The FINRA arbitration hearing was conducted in Chicago, Illinois.
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, Sigma Financial Corporation and Sigma Planning Corporation may be liable for investment or other losses suffered by Scherschel’s customers.
Erez Law represents investors in the United States for claims against Sigma Financial Corporation and Sigma Planning Corporation financial advisor Louis Frederick Scherschel, who is alleged to recommend unsuitable sales of leveraged exchange traded funds (ETFs) and failure to execute a sale order for ETFs. If you were a client of Sigma Financial Corporation and Sigma Planning Corporation financial advisor Louis Frederick Scherschel 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.