Yield of Dreams

Another Case of How Bad Firms Come Back to Bite You

RSS

A former broker’s case against FINRA was dismissed by the United States Court of Appeals Wednesday, but the case just goes to show that bad firms can come back to bite financial advisors, even if they had nothing to do with it.

Neil Aslin joined Brewer Financial in May 2005, and left to join BEST Direct in April 2009, according to court documents. But in 2010, the Securities and Exchange Commission charged Brewer for selling fraudulent, unregistered promissory notes to investors. From then on, Aslin had a target on his back, so to speak.

His new firm, BEST Direct, became subject to FINRA’s taping rule, which requires a securities firm to adopt significant monitoring measures when too many of its brokers have recently worked for “disciplined firms.” Eleven of its 17 registered reps came from Brewer, so instead of having to implement the monitoring system, the firm instead fired Aslin. He fought back.

But Aslin’s background gets even more confusing from there. Aslin now works for PFGBest, or Peregrine Financial Group, the mid-sized futures brokerage that is now embroiled in a scandal in which $215 million of client money went missing. (The scandal even caused its founder to make a suicide attempt.)

Currently, Aslin serves as president of Peregrine Asset Management and vice chairman of PFGBest. And PFGBest is the parent company of BEST Direct, his old broker/dealer! So why would the broker/dealer’s parent company give him a job after they fired him, especially while he’s pursuing legal action related to the company’s behavior?

Aslin clearly had issues, and his case was not black and white, given his current association with a firm involved in a scandal all its own. But was his a case of a bad firm happening to a good advisor? Or is it a bad broker happening to a good firm?

Please or Register to post comments.

What's Yield of Dreams?

Casting a gimlet-eye on the independent broker/dealer channel and asset management issues.

Blog Archive

Sponsored Introduction Continue on to (or wait seconds) ×