Finra panel orders Woodbury to pay customers $1.1 million

Finra panel orders Woodbury to pay customers $1.1 million
Arbitration panel says firm failed to supervise former broker's unsuitable transactions.
JUN 26, 2018

A Financial Industry Regulatory Authority Inc. arbitration panel has ruled that Woodbury Financial Services must pay $970,107.21 in compensatory damages and $121,468 in interest to two clients as a result of the firm's failure to supervise a former broker. The clients, Kris and Sandy Dielman, charged that the firm breached its fiduciary duty, was negligent and engaged in fraud and deceit in connection with selling them investments in several companies, variable annuities and unspecified A-share mutual funds. The Finra panel found that Woodbury permitted the execution of the unsuitable transactions as a result of its failure to supervise former broker Robert Hayes Hoffmann, who was affiliated with Woodbury from 2008 to 2017. Because Mr. Hoffman filed for bankruptcy in February of this year, the panel did not rule on any of the claims against him. According to his BrokerCheck record, Mr. Hoffman had eight disclosures over a 17-year career in the securities industry. Before Woodbury, he worked for Northwestern Mutual Investment Services and Robert W. Baird & Co. Inc.

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