Carson Wealth Management, one of the most recognizable names in the financial advisory business, is being sued by a former client for $500,000 for charging fees the client claims were excessive.
The arbitration claim, which was filed on Dec. 24, came to light on the Financial Industry Regulatory Authority Inc.'s BrokerCheck profile of Ron Carson, the well-known head of Carson Wealth Management. It was initially reported Wednesday on Financial Planning magazine's website.
The investment products in question involve so-called "direct investments," as well as limited partnerships, according to BrokerCheck, both of which are typically illiquid.
The client also alleges that Carson Wealth Management improperly notified an unnamed product sponsor that the client was no longer a client of the firm. This resulted in the client allegedly being charged the product sponsor's standard fees, rather than a lower rate negotiated by the firm, according to the allegations listed on BrokerCheck.
"As a result, the client claims that it was overcharged fees by the product sponsor," according to the allegations listed on BrokerCheck.
Mr. Carson is a registered broker with Cetera Advisor Networks, which he joined in 2017 after spending 27 years at LPL Financial. He has two other customer disputes on his BrokerCheck profile: one that was withdrawn in 2004 and another from 2002 that claimed $12 million in damages and resulted in a $50,000 award.
"For clarification, Carson, in fact, negotiated on the client's behalf to save the client millions — not cost the client, as stated in the dispute," Mr. Carson said in an email message to InvestmentNews. "The firm never received any of the aforementioned fees from the client, a sponsor, or any other third party in exchange for services and, by negotiating great terms, actually made the client millions of dollars on their investment."
"The allegation is currently in dispute and has not been finalized," said firm spokesman Sam Johnston, who added that Mr. Carson and his firm have not been found in violation of the client's claims.
Carson Wealth Management has $5.1 billion in total assets under management, according to the firm's Form ADV on file with the Securities and Exchange Commission.