In March 2019, a former client of Money Concepts Capital Corp. won an award in a FINRA arbitration for compensatory damages for $698,979, plus 8% per annum until the award is paid in full, and $27,920 in costs and 244,642 in attorney fees. The investors were clients of financial advisor Craig Sutherland (CRD# 2001873).
The causes of action included violations of the Ohio Securities Act, negligence, suitability, failure to supervise, failure to conduct due diligence, violations of industry rules, breach of contract, breach of fiduciary duty, fraud, and respondeat superior. The causes of action relate to allegations that Sutherland had discretionary authority over their accounts and misrepresented the risks associated with investments in Tanzanian Royalty Exploration Corporation (“TRX”), a publicly-traded mineral resources company; a private placement called NGAS Partners 2009-A; and various gold funds, resulting in significant losses to Claimants. Claimants further allege that Sutherland sold them six variable annuities, which were allocated in cash without Claimants’ knowledge, and that the cash allocation and annuities’ expenses have resulted in loss to the annuities’ value in a time when markets have risen. The FINRA arbitration hearing was conducted in Columbus, Ohio.
Sutherland has been registered with Money Concepts Capital Corp. in Columbus, Ohio since 1994.
In June 2018, the State of Ohio opened an investigation into Sutherland that “alleges that RR has been the subject of three additional customer complaints, sent emails through his personal and B/D email accounts that contained false and exaggerated statements about TRX, failed to update his Form U4 regarding order number 17-018 or notify an expungement panel about it.”
In January 2018, FINRA suspended Sutherland for 15 days and sanctioned him to $5,000 in civil and administrative penalties after he consented to the sanctions and to the entry of findings that he utilized his personal email address for communications to a customer related to his securities business.
Sutherland has been the subject of 11 customer complaints between 2010 and 2018, two of which were denied, according to his CRD report:
- July 2018. “Client alleging unsuitable investments, negligence, failure to conduct due diligence, supervise and other industry rules.” The customer is seeking $275,000 in this pending customer complaint.
- March 2018. “Client alleging unsuitable investments, negligence, failure to conduct due diligence, supervise and other industry rules.” The customer is seeking $100,000 in this pending customer complaint.
- February 2018. “Client alleging unsuitable investments, negligence, failure to conduct due diligence, supervise and other industry rules.” The customer is seeking $400,000 in damages and the case is currently pending.
- November 2016. “[Customer]owed a diversified fee based managed account along with a deferred annuity in her IRA. {Customer] wanted to speculate with a portion of her money in her managed account. With that portion she purchased shares of Tanzania Royalty Exploration. [Customer] is looking to recover the stocks lost value in addition to all of the fees associated with the managed account for the years she held it. [Customer] is identifying one position only within the diversified managed portfolio. The representative has documentation of her knowledge and acceptance of the purchase of Tanzania Royalty shares, reviews ongoing of all of her portfolio signed by [Customer]. and never had an issue during their duration of the relationship. [Customer] never reached out to representative or the broker dealer to express any concern.” The customer sought $25,000 in damages and the case was settled for $14,500.
- January 2016. “The firm received a letter of demand from the customer attorney. Although the demand letter did not identify any transaction, attorney is alleging customer suffered a net loss of approximately $300000 as a result of reps negligent and inappropriate management of customer accounts. Customer accounts are non-discretionary and are not managed by rep. Attorney did not identify any specific transaction that he contends were inappropriate. Client is alleging unsuitability, negligence, misrepresentation, breach of fiduciary duty and breach of contract. Client alleges her funds to be over-concentrated in equities. 6/6/2016 Client is alleging unsuitability, negligence, misrepresentation, breach of fiduciary duty and breach of contract. Client alleges the funds were over concentrated in equities.” The customer sought $300,000 in damages and the case was settled for $130,000.
- June 2014. “Claimants are alleging the John Hancock variable annuity, Ngas Oil & Gas, American Realty Capital Healthcare REIT and Tanzanian Royalty Exploration Company (TRX) were unsuitable. They further allege misrepresentation and omissions, breach of fiduciary duty, violation of FINRA conduct rules, neglect, failure to supervise, breach of contract, and vicarious liability. Claimants are alleging they have suffered damages of approximately $500,000. Claimants are alleging the John Hancock variable annuity, Ngas oil & gas, American realty capital healthcare REIT and Tanzanian royalty exploration company (TRX) were unsuitable. They further allege misrepresentation and omissions, breach of fiduciary duty, violation of FINRA conduct rules, neglect, failure to supervise, breach of contract, and vicarious liability. Claimants are alleging they have suffered damages of approximately $500,000.” The case was settled for $130,000.
- March 2012. “Clients allege unauthorized and unsuitable investments involving numerous purchases of Tanzanian Royalty Exploration corporation which were purchased in all four accounts. Client’s also alleged that registered representative failed to advise clients about mutual fund breakpoints and front-end loads both of which resulted in excess commissions. Rep denies these allegations.” The customer sought $42,268 in damages and the case was settled for $10,472.
- December 2010. “February 2008 client opened account with RR. Client is alleges unsuitability negligence, unauthorized trading, violation of oh Blue-Sky laws, breach of fiduciary duties and breach of contract.” The customer sought $141,000 in damages and the case was settled for $63,000.
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, Money Concepts Capital Corp. may be liable for investment or other losses suffered by Sutherland’s customers.
Erez Law represents investors in the United States for claims against brokers and brokerage firms for wrongdoing. If 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.
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