According to an administrative complaint filed by Massachusetts securities regulators, Purshe Kaplan Sterling Investments (PKS) failed to supervise Harvest Group Wealth Management. Harvest Group allegedly sold unsuitable investments to customers.
The complaint alleges that PKS did not review or flag any of the thousands of transactions at issue which occurred between August 2017 and April 2020. Harvest Group received warnings from the Financial Industry Regulatory Authority (FINRA) regarding the exchange-traded funds. Despite warnings, Harvest invested more than 340 client accounts in leveraged exchange-traded funds. The transactions in question were outside of the scope of the agents' employment with PKS. However, the broker-dealer had a duty to review those transactions as part of its responsibilities.
Massachusetts state securities regulators are seeking to require PKS to provide full restitution to investors who suffered losses from the alleged failure to supervise and also asking that PKS be censured and fined.
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