FINRA Fines Ameriprise Rep for Unsuitable MLP Investment
The Financial Industry Regulatory Authority fined 22-year Ameriprise veteran advisor Geraldine Gordon for recommending a client invest half of her liquid net worth into a speculative energy investment.
Gordon received a 10-day suspension and $7,500 fine for recommending her client liquidate a number of diversified investments totaling $334,000 in her Ameriprise brokerage and IRA accounts and use those assets to purchase a master limited partnership focused on the energy-sector.
FINRA Rule 2111 provides that when recommending the purchase, sale, or exchange of any security to a customer, a registered representative must have a reasonable basis to believe that a recommended transaction is suitable. FINRA said that a single sector-focused MLP was not suitable for the client in light of her financial condition and the excessively concentrated nature of the investment.
