The Wolper Law Firm, P.A. Has Filed A FINRA Arbitration Claim Against Centaurus Financial For The Sale Of Illiquid Structured Products To A 75 Year-Old Retiree
The Wolper Law Firm, P.A. announces that it has filed a FINRA arbitration claim against Centaurus Financial based on the unlawful recommendations made by its financial advisers, Ricky Mantei, Cindy Chiellini and Kathy Nishnic, who have a combined fourteen (14) customer complaints against them for alleged sales practice violations.
The Statement of Claim filed with FINRA alleges:
“This case is about the sale of unsuitable and illiquid securities, including but not limited to, structured products, non-traded real estate investment trusts (“Non-Traded REITs”) and Unit Investment Trusts (“UITs”) to a seventy-five (75) year old retired blue-collar worker with impaired cognitive function. The disputed investments were grossly unsuitable for Claimant, who was told he was purchasing “bonds” and “CDs” with a fixed rate of interest. In reality, what Respondents sold him was an over-concentrated portfolio of long-term, adjustable rate structured products. The income stream of these investments is dependent upon a complex formula calculated by the relationship between various indices and the Constant Maturity Swap rate (“CMS Rate”). None of these complexities were ever explained to Claimant nor would they have ever been understood.
With the rise of interest rates over the last two years from historic lows, and the corresponding flattening of the yield curve, the interest rate has adjusted on Claimant’s investments and they now pay zero income. Moreover, because they are long-term investments paying zero income, the principal value of these investments has precipitously declined. Claimant is now faced with the prospect of holding non-income producing fixed income assets until maturity (2028-2036), which is likely beyond his life expectancy, or sell these investments at a steep loss.”
The sale of esoteric products is a growing trend in the securities industry, particularly among independent brokers, due to the high commissions. These structured products generated commissions of approximately 3%. It is alleged that Ricky Mantei, Cindy Chiellini and Kathy Nishnic made the aforementioned recommendations in order to secure larger commissions, as opposed to putting Claimant’s interest ahead of their own.
If you or someone you know are clients of Centaurus Financial or Ricky Mantei, Cindy Chiellini and Kathy Nishnic and you experienced investment losses, please contact the Wolper Law Firm at 800.931.8452 or by email at email@example.com to discuss your specific situation and the legal options available. The Wolper Law Firm represents investors nationwide in securities litigation and arbitration.
Matt Wolper, the Managing Principal of the Wolper Law Firm, is a trial lawyer who has handled hundreds of securities cases during his career involving a wide range of products, strategies and securities. Prior to representing investors, he was a partner with a national law firm, where he represented some of the largest banks and brokerage firms in the world in securities matters.