An arbitration panel for the Financial Industry Regulatory Authority (“FINRA”) has made findings against Crystal Bay Securities, Inc. of Delray Beach, Florida and entered an award against the firm for $192,598.90: over $50,000 more than the total requested by the Claimant.
The award followed a customer’s complaint involving allegations of breach of fiduciary duty, exploitation of a vulnerable adult, violation of Florida’s Securities and Investor Protection Act, negligence, and failure to supervise. The customer complaint involved purchases of Real Estate Investment Trusts (“REITs”) in the customer’s account.
Crystal Bay Securities and its broker, Rafael Golan, were found in violation of the Florida Securities and Investor Protection Act based on the sales of alternative investment product REITs including ARC Global Trust (a/k/a Global Net Lease), BSP – Business Development Corp. of America, ARC Realty Finance Trust, and PE – Grocery Center REIT I, Inc.
The arbitrators order recission of the customer’s purchases of these REITs, $136,201.82 in compensatory damages, plus interest, as well as $25,000 based on the respondents’ “gross negligence” and “conscious disregard or indifference to the rights of Claimant, which include failure to disclose risk, fraud and extreme carelessness in the record making and keeping of Claimant’s account forms.” The Respondents were also ordered to pay $3,897.07 in costs, $2,500 for the Claimant’s expert witness fees, unspecified attorneys’ fees, and a $25,000 sanction for violations of the Respondents’ discovery obligations.
The customer complaint is the latest of many made against Mr. Golan, whose FINRA BrokerCheck report details thirteen additional disclosures, including eight customer disputes and six regulatory actions and investigations.
If you or someone you know lost money as a client of Crystal Bay Securities or Rafael Golan due to unsuitable, misrepresented, or unauthorized transactions, please call the Frankowski Firm at 888.741.7503 or fill out this contact form.