Broker-Dealer Liability for Unlicensed Registered Investment Advisors

The past decade has seen an explosion of the number of Registered Representatives (stockbrokers) employed
by brokerage firms opting to leave their employment status in the brokerage industry to become
Registered Investment Advisors registered with the Securities and Exchange Commission. 

While many Registered Investment Advisors choose to let their securities industry licensure (FINRA/CRD)
lapse, many still maintain considerable ties to FINRA-registered brokerage firms they were formerly
employed with.  Additionally, many Registered Investment Advisors in the securities industry have
formed extensive ties to one or several brokerage firms, working closely with them on a day-to-day
basis, notwithstanding their lack of licensure with these brokerage firms.

There have been numerous instances of the relationship between a brokerage firm and an unlicensed
Registered Investment Advisor becoming blurred and intertwined with these non-FINRA-licensed Registered
Investment Advisors having been deemed to be de facto employees of brokerage firms,
notwithstanding their lack of securities industry licensure.

In circumstances of Registered Investment Advisor theft, malfeasance, or wrongdoing, victimized investors
who have dealt with unlicensed, uninsured, insolvent or bankrupt Registered Investment Advisors have
remedies against FINRA-licensed brokerage firms, who have permitted investment victimization to occur.

We offer a free initial consultation to investors who feel they have been victimized by a Registered
Investment Advisor.  For an appointment, contact us at 518-426-7700.

The Law Offices of Timothy J. O’Connor practices securities law in the Tri-City Capital District of
Albany, Schenectady and Troy.  We also represent victimized investors throughout the rest of
New York State, including Buffalo, Binghamton, Rochester, Syracuse, Watertown, Utica, Kingston,
Poughkeepsie, New York City/Manhattan, Long Island, and everywhere in between, as well as in the
surrounding states of Massachusetts, Vermont, New Hampshire, Connecticut, and New Jersey.



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