David Michael Faubert – and the firm that employs him or her – is regulated by the Financial Industry Regulatory Authority (FINRA).
If you are like most people, before you go out to dinner at a new restaurant, you probably take a quick look at the reviews. This makes sense; you are going to pay for an expensive dinner, and you need to be sure that you are getting a good value.
Yet, when choosing a financial advisor, many people fail to conduct this same level of due diligence. Before turning over access to your money, you need to be sure that you have found a financial advisor that you can trust. Here, our audit report, including details of allegations, complaints, and sanctions will help you decide whether or not to invest with David Michael Faubert.
BrokerComplaints.com is currently investigating allegations related to David Michael Faubert. We provide a free platform for investors to help them in their claims against negligent brokers and brokerage firms.
About David Faubert
David Michael Faubert is an Investment Adviser. David Michael Faubert’s Central Registration Depository (CRD) number is 2150188 and the FINRA Profile can be found at – https://brokercheck.finra.org/individual/summary/2150188.
Click here to download a Detailed Audit Report for David Michael Faubert.
David Michael Faubert has previously been reprimanded and has disclosures and/or client dispute(s) listed at FINRA BrokerCheck.
Accusations and Disclosures
You can find below, a quick snapshot of David Michael Faubert’s regulatory actions, arbitrations, and complaints.
DISCLOSURE 1 –
- Event Date: 1/10/2006
- Disclosure Type: Regulatory
- Disclosure Resolution: Final
- Disclosure Detail :: DocketNumberFDA:
- Initiated By: UNITED STATES SECURITIES AND EXCHANGE COMMISSION
- Allegations: SEC RELEASE #34-53089 AND IA RELEASE # 40-2427 DATED JANUARY 10, 2006 – ON DECEMBER 14, 2005, A FINAL JUDGMENT WAS ENTERED AGAINST FAUBERT, PERMANENTLY ENJOINING HIM FROM FUTURE VIOLATIONS OF SECTION 17(A) OF THE SECURITIES ACT OF 1933 (SECURITIES ACT), SECTION 10(B) OF THE EXCHANGE ACT AND RULE 10B-5 THEREUNDER, AND SECTIONS 206(1) AND 206(2) OF THE ADVISERS ACT, IN THE CIVIL ACTION ENTITLED SECURITIES AND EXCHANGE COMMISSION V. DAVID M. FAUBERT, ET AL., CIVIL ACTION NUMBER 3:05CV00510, IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF CONNECTICUT. THE COMMISSION’S COMPLAINT ALLEGED THAT FROM 2000 UNTIL MARCH 2005, FAUBERT USED FFG TO DEFRAUD AS MANY AS 15 CLIENTS OF OUT OF APPROXIMATELY $2.4 MILLION. FAUBERT PROMISED THE CLIENTS HE WOULD INVEST THEIR MONEY IN A FIXED ACCOUNT WITH A GUARANTEED RETURN OF 8%. INSTEAD, HE DIVERTED THE CLIENTS’ FUNDS FOR HIS PERSONAL USE, INCLUDING THE PAYMENT OF HIS GAMBLING DEBTS. FAUBERT CONCEALED HIS FRAUD BY PROVIDING THE CLIENTS WITH FICTITIOUS ACCOUNT STATEMENTS, AND OTHERWISE ENGAGED IN A VARIETY OF CONDUCT, WHICH OPERATED AS A FRAUD AND DECEIT ON INVESTORS, THE COMPLAINT ALLEGED.
- Resolution: Order
- Sanction Details :: Sanctions: Bar
- Sanction Details: SEC ACT 34-53417, IA ACT 40-2493, DATED MARCH 6, 2006; IT IS ORDERED, PURSUANT TO SECTION 15(B) OF THE SECURITIES EXCHANGE ACT OF 1934 AND SECTION 203(F) OF THE INVESTMENT ADVISERS ACT OF 1940, THAT RESPONDENT DAVID M. FAUBERT IS BARRED FROM ASSOCIATING WITH ANY BROKER, DEALER, OR INVESTMENT ADVISER.
DISCLOSURE 2 –
- Event Date: 3/31/2005
- Disclosure Type: Regulatory
- Disclosure Resolution: Final
- Disclosure Detail :: DocketNumberFDA:
- Initiated By: CONNECTICUT
- Allegations: THE RESPONDENT IS ALSO THE PRESIDENT OF FAUBERT FINANCIAL GROUP, INC., AN INSURANCE AGENCY LOCATED IN AVON, CONNECTICUT. THE NOTICE OF INTENT TO REVOKE REGISTRATION AS AGENT AND ORDER SUMMARILY SUSPENDING REGISTRATION AS AGENT ALLEGED THAT THE RESPONDENT 1) WILFULLY VIOLATED SECTION 36B-16 OF THE CONNECTICUT UNIFORM SECURITIES ACT BY SELLING UNREGISTERED SECURITIES IN THE FORM OF PROMISSORY NOTES AND INVESTMENTS IN HIS BUSINESS, CREATIVE MARKETING CONSULTANTS, LLC; 2) WILFULLY VIOLATED SECTION 36B-31-6E OF THE REGULATIONS UNDER THE ACT BY ENGAGING IN PRIVATE SECURITIES TRANSACTIONS WITHOUT NOTICE TO HIS EMPLOYING BROKER-DEALER; AND 3) WILFULLY VIOLATED THE ANTIFRAUD PROVISIONS IN SECTION 36B-4(A) OF THE ACT BY APPROPRIATING FOR HIS PERSONAL USE INVESTOR FUNDS GIVEN TO HIM FOR INVESTMENT IN THE PROMISSORY NOTES AND THE CREATIVE MARKETING CONSULTANTS, LLC INVESTMENTS AND BY DISSEMINATING FALSE ACCOUNT STATEMENTS TO CONNECTICUT INVESTORS REGARDING THOSE INVESTMENTS. THE NOTICE OF INTENT TO REVOKE REGISTRATION AS AGENT AND ORDER SUMMARILY SUSPENDING REGISTRATION AS AGENT RECITED THAT THE RESPONDENT HAD ADMITTED TO DIVISION PERSONNEL THAT, SINCE 2000, HE HAD STOLEN APPROXIMATELY $4 MILLION FROM AT LEAST 15 CLIENTS THROUGH THE SALE OF FRAUDULENT SECURITIES. ON MARCH 24, 2005, THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF CONNECTICUT GRANTED A TEMPORARY RESTRAINING ORDER, ORDER FREEZING ASSETS AND ORDER FOR OTHER EQUITABLE RELIEF AGAINST THE RESPONDENT AND FAUBERT FINANCIAL GROUP, INC. IN AN ACTION BROUGHT BY THE SECURITIES AND EXCHANGE COMMISSION.
- Resolution: Order
- Sanction Details :: Sanctions: Revocation/Expulsion/Denial
- Sanctions: SEE RESPONSE TO ITEM 13.C.
- Sanction Details: THE ORDER REVOKING REGISTRATION AS AGENT (ENTERED ON MAY 19, 2005) ADOPTED AS FINDINGS THE ALLEGATIONS IN THE MARCH 31, 2005 NOTICE OF INTENT TO REVOKE REGISTRATION AND ORDER SUMMARILY SUSPENDING REGISTRATION AS AGENT. RESPONDENT DID NOT APPEAR OR CONTEST THE REVOCATION OF HIS AGENT REGISTRATION. ALSO ON MAY 19, 2005, THE COMMISSIONER VACATED THE MARCH 31, 2005 ORDER SUMMARILY SUSPENDING REGISTRATION AS AGENT.
DISCLOSURE 3 –
- Event Date: 3/23/2005
- Disclosure Type: Civil
- Disclosure Resolution: Final
- Disclosure Detail :: Initiated By: UNITED STATES SECURITIES AND EXCHANGE COMMISSION
- Allegations: SEC LITIGATION RELEASE NO. 19166 DATED APRIL 5, 2005; THE SEC’S COMPLAINT ALLEGED VIOLATIONS SECTION 17(A) OF THE SECURITIES ACT [15 U.S.C. 77Q(A) AND SECTION 10(B) OF THE EXCHANGE ACT [15 U.S.C. 78J(B) AND RULE 10B-5 THEREUNDER [17 C.F.R. 240.10B-5. THE COMPLAINT ALSO ALLEGED VIOLATIONS OF SECTIONS 206(1) AND (2) OF THE ADVISERS ACT [15 U.S.C. 80B-6(1), (2). THE VIOLATIONS OF SECTION 17(A) OF THE SECURITIES ACT HAVE INVOLVED FRAUD, DECEIT OR DELIBERATE OR RECKLESS DISREGARD OF REGULATORY REQUIREMENTS AND HAVE RESULTED IN SUBSTANTIAL LOSSES OR SIGNIFICANT RISK OF SUBSTANTIAL LOSSES TO OTHER PERSONS, WITHIN THE MEANING OF SECTION 20(D) OF THE SECURITIES ACT [15 U.S.C. 77T(D). AS THE COMMISSION SET FORTH IN ITS COMPLAINT, THE DEFENDANT DEFRAUDED CLIENTS OF APPROXIMATELY $2.4 MILLION BY FALSELY TELLING THEM THAT THEIR MONEY WAS INVESTED IN A FIXED ACCOUNT THAT GUARANTEED AN 8% RETURN WHEN, IN FACT, THE DEFENDANT WAS DIVERTING FUNDS FOR HIS PERSONAL USE, INCLUDING FOR THE PAYMENT OF GAMBLING DEBTS. ACCORDING TO THE COMPLAINT, ON MARCH 14, 2005, REPRESENTATIVES OF THE SECURITIES AND BUSINESS INVESTMENTS DIVISION OF THE CONNECTICUT DEPARTMENT OF BANKING BEGAN AN EXAMINATION OF THE DEFENDANT’S ACTIVITIES BASED ON A CLIENT COMPLAINT. ON MARCH 22, 2005, SHORTLY AFTER THE CONNECTICUT AUTHORITIES DEMANDED THAT THE DEFENDANT PRODUCE CERTAIN RECORDS, THE DEFENDANT ADMITTED TO HAVING DEFRAUDED HIS CLIENTS. IN ITS COMPLAINT, THE SEC CHARGES THAT, TO CONCEAL THE FRAUD, THE DEFENDANT PROVIDED HIS CLIENTS WITH FABRICATED ACCOUNT STATEMENTS.
- Resolution: Judgment Rendered
- Sanction Details :: Sanctions: Disgorgement/Restitution Sanctions: Cease and Desist/Injunction
- Sanction Details: SEC REL. 19523, JANUARY 5, 2006; THE SECURITIES AND EXCHANGE COMMISSION ANNOUNCED TODAY THAT IT HAD OBTAINED A DEFAULT JUDGMENT PERMANENTLY ENJOINING DAVID M. FAUBERT (FAUBERT) FROM VIOLATING SECTION 17(A) OF THE SECURITIES ACT OF 1933, SECTION 10(B) OF THE SECURITIES EXCHANGE ACT OF 1940 AND RULE 10B-5 THEREUNDER, AND SECTIONS 206(1) AND (2) OF THE INVESTMENT ADVISERS ACT OF 1940. IN ADDITION, FAUBERT WAS ORDERED TO PAY OVER $7.5 MILLION IN DISGORGEMENT AND PENALTIES. THE ORDER WAS ENTERED BY A UNITED STATES DISTRICT COURT JUDGE ON DECEMBER 14, 2005.
According to a study prepared for the FINRA Investor Education Foundation, 80 percent of American investors report that they have been solicited to participate in a fraud scheme, while 11 percent of American investors report that they personally lost money as a result of fraud.
FINRA notes that the rate of investment fraud is most likely much higher than it is reported. This is because many victims of financial advisor scams are too ashamed to come forward. Further, the study also found that a significant number of investors do not know how to spot common red flags of investment fraud. The least you should do is share your experience with other potential victims of investment scams.
Under federal securities law and securities industry regulations, registered investment firms have a legal duty to supervise their financial advisors. Section 15(b)(4)(E) of the Securities and Exchange Act of 1934 makes a securities firm liable for the conduct of representatives.
- TOWER SQUARE SECURITIES, INC. (CRD#: 833) :: 2/10/2003 – 3/31/2005 :: EL SEGUNDO, CA
- USALLIANZ SECURITIES, INC. (CRD#: 40875) :: 3/28/2002 – 2/7/2003 :: MINNEAPOLIS, MN
- ADVANTAGE CAPITAL CORPORATION (CRD#: 146) :: 8/15/1994 – 1/31/2002 :: ATLANTA, GA
- TRAVELERS EQUITIES SALES, INC. (CRD#: 833) :: 11/2/1993 – 8/15/1994 :: EL SEGUNDO, CA
The duty to supervise securities representatives is a strong legal requirement. Registered investment firms must take many different steps to ensure that they are protecting their customers from irresponsible and criminal financial advisors.
Legit or Not?
Unfortunately, stockbroker fraud is more common than many investors would like to think. And yes, stockbrokers (including David Michael Faubert, but not limited to) can (and do) steal money from their clients. While it’s rare that a broker will literally steal his client’s money (though that does happen), typically the “theft” of investment funds comes in the form of other fraudulent violations of securities law and FINRA rules which leads to significant investment losses.
Investors generally understand that there are risks associated with buying and selling securities. The market can go up, and the market can go down. No matter how skilled of an investor you are, there are always risks. With that being said, sometimes investment losses cannot be blamed on simple back luck.
There are 10 major types of complaints we receive against Investment Brokers –
- Outright Theft (Conversion of Funds)
- Unauthorized Trading
- Misrepresentation or Omission of Material Facts
- Excessive Trading (Churning)
- Lack of Diversification
- Unsuitable Investment Recommendations
- Failure to Disclose a Personal Conflict of Interest
- Front Running of Transactions
- Breakpoint Sale Violations
- Negligent Portfolio Management
Do your due diligence before investing. Public records are available for everybody to review and decide on the safest bet.
How to Protect Yourself
We, as citizens, place a great deal of trust in the financial advisors who are tasked with helping us achieve and maintain financial security. Most of the time financial advisors and stockbrokers are honest folks who work diligently in their client’s best interests. However, on occasion financial advisors and the brokerage firms who employ them mess up and cause serious financial harm to their clients. Sometimes these losses are caused by simple negligence. Other times fraud or other serious misconduct is to blame.
Here are 5 signs that your broker needs to be reported –
- Breach of Fiduciary Duty: Under the Investment Advisers Act of 1940, certain investment professionals, known as registered investment advisors (RIAs), owe fiduciary obligations to their customers. Your investment broker must always look out for your best interests. If you lost money because of your broker’s breach of fiduciary duty, you may be entitled to compensation for the full value of your damages.
- Unsuitable Investments: Many financial advisors are not fiduciaries. Instead, they are held to the suitability standard. These stockbrokers and financial advisors can only sell and recommend financial products that are appropriate for a customer’s unique investment profile. If you lost money in unsuitable investments, you should consider reporting them.
- Material Misrepresentations or Omissions: Brokers have a duty to make fair and honest representations to their clients. If they fail to do so, and an investor loses money due to a misrepresentation or a material omission, the broker may be liable for the investor’s losses.
- Lack of Diversification: Brokers must also act with the appropriate level of professional skill. Pushing a customer into over-concentrated investments is highly risky. Brokers can be held liable for losses sustained because of an investor’s inappropriate lack of diversification.
- Excessive Trading (Churning): Stockbrokers and financial advisors must have a well-grounded, reasonable basis to execute all trades. Unfortunately, there are cases in which brokers will frequently trade on a customer’s account, simply to increase their own fees. This unlawful practice is known as churning.
- Unauthorized Trading: Brokers must have the proper legal authority to make transactions on behalf of a client. If you lost money because your broker made trades that you never approved of, you may have been the victim of unauthorized trading. You should consult with an experienced attorney.
Report David Faubert
In order to prevail in an investment fraud lawsuit or FINRA arbitration cases, you must be able to assert a viable ‘cause of action’.
David Michael Faubert – and the firm that employs this broker – is regulated by the Financial Industry Regulatory Authority (FINRA). FINRA provides an online form to allow investors to file a formal complaint against their financial advisor, stockbroker, or brokerage firm.
Click here to go to FINRA’s Online Complaint Form →
This form will ask you for specific information related to your complaint. Be prepared by gathering the following:
- Name and symbol for the investment product in question.
- The CRD number (2150188) for the broker – David Michael Faubert
- Your complete contact information.
Remember, it is advised to report your broker to FINRA, only after you have exhausted all of your other remedies and carefully prepared a compelling complaint. Once you file a complaint against your broker at FINRA, your case will be bound by FINRA’s rules and the arbitration panel’s eventual decision. The time clock will start, and your complaint will be served on your broker or broker-dealer.
The views and opinions expressed in these articles are those of the source BrokerComplaints.com and do not necessarily reflect the official position of ‘The Skeptic Files,’ which shall not be held liable for any inaccuracies presented. The information provided within this article is for general informational purposes only. While we try to keep the information up-to-date and correct, there are no representations or warranties, express or implied, about the completeness, accuracy, reliability, suitability or availability of the information in this article for any purpose.
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