Did you suffer investment losses with Ace Diversified Capital (CRD# 41768) (SEC# 8-49555)?
Galvin Legal, PLLC is launching an investigation on behalf of investors who may have suffered losses investing with Ace Diversified Capital. If you suffered losses investing with Ace Diversified Capital, then Galvin Legal, PLLC may be able to help you recover your losses in a Financial Industry Regulatory Authority (“FINRA“) arbitration claim.
If you suffered losses and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
As of September 9, 2020, Ace Diversified Capital’s FINRA BrokerCheck Report contains the following:
2 Regulatory Event Disclosures
See FINRA Letter of Acceptance, Waiver and Consent No. 2016049183302
UPDATE 9/14/2020: According to FINRA’s November 2019 Disciplinary Actions: “Ace Diversified Capital, Inc. (CRD #41768, San Gabriel, California) September 11, 2019 – An AWC was issued in which the firm was censured, fined $20,000, ordered to pay $9,442, plus interest, in restitution to customers and required to revise its supervisory systems, including its written procedures, to address the deficiencies described in the AWC as they related to the sale of non-traditional exchange-traded funds and notes; quantitative suitability related to potentially excessive trading; and options trading. A lower fine was imposed after considering, among other things, the firm’s revenue and financial resources. Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it failed to reasonably supervise a former representative’s sale of non-traditional exchange-traded funds (ETFs) and exchange-traded notes (ETNs) to his customers. The findings stated that none of the representative’s customers had experience investing in complex securities. Despite his customers’ limited financial means, lack of sophistication and risk tolerance, the firm permitted the representative to recommend non-traditional ETF and ETN purchases, with a total value of $262,867, for the customer’s accounts. Moreover, notwithstanding the risks associated with holding periods longer than a day, the accounts held overnight positions in these securities for an extended period of time. The two customers suffered $7,506 and $1,882 in losses, respectively, in connection with the recommendations. The firm failed to establish and maintain any supervisory system, WSPs or training to ensure the suitability of non-traditional ETF and ETN recommendations to its customers or monitor the risks associated with holding non-traditional ETFs and ETNs for extended periods of time. The firm’s training on these products was likewise unreasonable in that its training materials were limited to a brief, one-paragraph overview of leveraged and inverse ETFs. The findings also stated that the firm failed to establish a supervisory system, including written procedures, that was reasonably designed to detect potential excessive trading and, therefore, achieve compliance with the requirement that the firm’s recommendations are quantitatively suitable. The firm failed to detect that the former representative’s trading in his customers’ accounts reached levels that are indicative of excessive trading. The findings also included that the firm failed to establish and maintain a reasonable supervisory system, including WSPs, concerning the approval of options accounts. The firm accepted options orders in an account that was not approved for options trading by a registered options principal. That account was located in a branch office with more than three registered representatives and whose principal supervisor, the branch manager, was not qualified to supervise an options business. The firm’s supervisory system and WSPs were unreasonable because they did not require the branch’s principal supervisor to obtain the necessary qualification as a registered options principal to supervise the branch’s options business. (FINRA Case #2016049183302)
Main Office Location
923 EAST VALLEY BLVD.,
SUITE 213
SAN GABRIEL,, CA 91776
UNITED STATES
Mailing Address
923 EAST VALLEY BLVD.,
SUITE 213
SAN GABRIEL,, CA 91776
UNITED STATES
Business Telephone Number
626-307-8300
If you suffered losses and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
Ace Diversified Capital’s Direct Owners and Executive Officers
JEN, LYNNWOOD (CRD#:2198343), CEO, CCO
JEN, LYNNWOOD (CRD#:2198343), PFO, POO
LEE, MOOHO (CRD#:2067251), PRESIDENT, CO-CCO, SHAREHOLDER
TIEN, SHYUEWEN GEORGE (CRD#:1941281), FINOP, CFO
If you suffered losses and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
Due Diligence Requirement
FINRA requires broker-dealers to conduct due diligence on investments and to conduct a suitability analysis when recommending securities to a customer that takes into account the customer’s knowledge and experience. FINRA Rule 2111(a) states that “a member or an associated person must have a reasonable basis to believe that a recommended transaction or investment strategy involving a security or securities is suitable for the customer, based on the information obtained through the reasonable diligence of the member or associated person to ascertain the customer’s investment profile. A customer’s investment profile includes, but is not limited to, the customer’s age, other investments, financial situation and needs, tax status, investment objectives, investment experience, investment time horizon, liquidity needs, risk tolerance, and any other information the customer may disclose to the member or associated person in connection with such recommendation.”
Rule 2111 is composed of three main obligations: reasonable-basis suitability, customer-specific suitability, and quantitative suitability. Broker-Dealers that fail to conduct adequate due diligence on investments they recommend or that make unsuitable recommendations can be held responsible for the customer’s losses in a FINRA arbitration claim.
If you suffered losses and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
Request a Free Consultation with a Securities Attorney
If you suffered losses investing with Ace Diversified Capital and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
This information is all publicly available and is being provided to you by Galvin Legal, PLLC.
Galvin Legal, PLLC is a national securities arbitration, securities mediation, securities litigation, securities fraud, securities regulation and compliance, and investor protection law practice. For more information on Galvin Legal, PLLC and its representation of investors, please visit www.galvinlegal.com or call 1-800-405-5117.
