Lincoln Financial Advisor Defamation Case Highlights The Limitations Of Brokercheck

Monday, April 16, 2012 09:18
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Lincoln Financial Advisor Defamation Case Highlights The Limitations Of Brokercheck

Tags: FINRA | investment advisors

Conflicting stories about a former rep that are now costing Lincoln Financial $2 million, but there's no trace of them in FINRA's publicly accessible database. That's probably a good thing.

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Jeffrey Concepcion managed Lincoln's Columbus and Cleveland offices until 2006, when negotiations to syndicate the firm's products stagnated and he was let go.

 

The controversy centers around why the deal failed, why Concepcion's six-year tenure ended, and how Lincoln Financial explained the situation.

 

FINRA agrees that in telling clients that Concepcion had left the industry, the firm was defaming his character and hampering his efforts to start fresh as an independent at LPL.

 

Whether Lincoln Financial actually told its management team they'd fired Concepcion for cause while shrugging publicly to customers, there's no trace left on his Brokercheck record.

 

The file doesn't disclose any events at all. No disciplinary action, no termination for cause or otherwise. 

 

Prospective clients trying to research Concepcion's career won't find any sign of the controversy in his official profiles with either FINRA or the SEC. That's a good thing.

 

But if they tried to track him down and were told verbally that he'd quit the business, would they have bothered to check with the regulators and find his new DBA?

 

Probably not. And in that scenario, even if Lincoln Financial kept Concepcion's Brokercheck record scrupulously clean, it wouldn't have achieved the purpose here.

 

Brokercheck and its SEC equivalent have yet to become the source of first and last resort for researching advisors. Retail investors need to learn to check these pages first and to verify all clais against them.

 

Until they do, it's nice if an advisor's page is accurate, but gossip and accounts published elsewhere can still damage his or her reputation.

 

That's apparently what happened here, and it's why FINRA has awarded Concepcion $2 million for defamation.

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