If potential clients had wondered about the suitability of Gig Harbor investment counselor Norman Gary Price of Strategic Capital Group, they could have checked a database at the Financial Industry Regulatory Authority website.
They might have read a news report concerning charges levied in September against Price’s firm for “engaging in hundreds of principal transactions through its affiliated broker-dealer without informing clients or obtaining their consent.”
Along with charging that the firm distributed “false and misleading advertisements to investors” the SEC claimed the firm “failed to seek best execution for the transactions it executed,” and said Price signed regulatory filings falsely stating that the firm did not engage in principal transactions.
Price was charged with causing some of the firm’s violations, and agreed to pay a $50,000 penalty to settle the charges against him.
Strategic Capital Group LLC agreed to pay nearly $600,000, the SEC said.
“Without admitting or denying the findings,” the agency said, the firm and Price also agreed to cease and desist from committing or causing further violations.
And had investors wished to check the FINRA site further, they would have found more information concerning Price’s education, his licenses, his work history, his registration in 13 other states and his recent entry into the Oregon market.
Price has been unavailable for comment.
And beyond the case of one broker, what generally should an investor do?
Lyn Peters, director of communications at the state Department of Financial Institutions, has some thoughts.
“You can’t just hand your future – and that’s what our retirement and investments are, our future – over to someone without doing any research and then be shocked or dismayed when or if something goes wrong.
“A huge part of any financial transaction responsibility is the responsibility of the consumer. Know what you’re buying. Know what you’re signing. If you don’t understand it, have a neutral, third party like an attorney explain it to you. Make sure you’re investing in what is right for you, your age, your income, your risk tolerance. Don’t let anyone pressure you. And be informed on what is happening with your money.”
Informed how? Here’s a few websites that can help you choose, check and decide.
• Pick more than one adviser to interview, Peters says, “and remember, they work for you.”
National Association of Personal Financial Advisors: napfa.org.
Financial Planning Association: fpanet.org.
Certified Financial Planner Board of Standards: cfp.net/search.
American Institute of CPAs: findapfs.com.
• Make sure they’re licensed to do business, and see if any action has been taken against them.
FINRA Broker Check: finra.org/brokercheck.
SEC Investment Adviser: adviserinfo.sec.gov.
Washington State Division of Securities: dfi.wa.gov/sd
• Check a company for an investment:sec.gov/edgar.shtml
To verify a CPA license: cpaboard.wa.gov.
• “I tell folks they need to read up on investment information,” Peters says.