DOUGLAS KEITH FLYNN at LPL FINANCIAL LLC – View Complaints, Disclosures, Scams and Audit Report (Updated 2023)

Disclosure #1 for DOUGLAS FLYNN

• • eventDate: 4/8/2013
  • Disclosure Type: Customer Dispute
  • Disclosure Resolution: Settled
  • Disclosure Detail :: Allegations: CUSTOMER ALLEGES THAT 1031 EXCHANGE TENANTS-IN-COMMON INVESTMENT OF $750,000 MADE IN MARCH 2008 WAS NOT SUITABLE AND THAT REPRESENTATIVES DID NOT FULLY ADVISE OF THE ASSOCIATED MARKET RISKS OF THAT INVESTMENT. CUSTOMER ASSERTS CLAIMS ALLEGING NEGLIGENCE, MISREPRESENTATION, BREACH OF CONTRACT, BREACH OF FIDUCIARY DUTY, FRAUD, AND VIOLATION OF FEDERAL AND STATE SECURITIES LAWS. CUSTOMER ALLEGES THAT HE HAS INCURRED LOSSES THROUGH THE DECLINE IN VALUE OF THE INVESTMENT. REPRESENTATIVE DENIES ALL FACTUAL ALLEGATIONS AND LEGAL CLAIMS ASSERTED, AND MAINTAINS THAT HE ACTED APPROPRIATELY IN ALL OF HIS DEALINGS WITH CUSTOMER. CUSTOMER HAD ALREADY SOLD HIS UNDERLYING PROPERTY AND HAD THE PROCEEDS WITH A QUALIFIED INTERMEDIARY TO PROCEED WITH A REQUESTED 1031 EXCHANGE BEFORE MEETING WITH REPRESENTATIVE, AND REPRESENTATIVE REVIEWED AVAILABLE POTENTIAL TIC INVESTMENTS FOR CUSTOMER WITHIN THE REQUIRED TIME PERIOD FOR COMPLETION FOR CUSTOMER’S CONSIDERATION. REPRESENTATIVE STATES THAT HE PROVIDED CUSTOMER WITH ACCURATE AND DETAILED INFORMATION CONCERNING ALL ASPECTS AND RISKS OF EACH INVESTMENT BEFORE CUSTOMER DECIDED TO INVEST, AND THAT CUSTOMER’S OTHER TIC INVESTMENT IS PERFORMING WELL AND THEREFORE, IS NOT THE SUBJECT OF THIS ACTION.
  • Damage Amount Requested: $1,503,225.00
  • Settlement Amount: $300,000.00
  • DisplayAAOLinkIfExists: Y
  • Arbitration Docket Number: 13-00938
  • Broker Comment: THE REPRESENTATIVES DENY ANY WRONGDOING WITH RESPECT TO CLAIMANT’S INVESTMENT IN THIS TENANT-IN-COMMON (TIC) THROUGH A 1031 EXCHANGE. SPECIFICALLY, IT WAS CLAIMANT HIMSELF WHO, AFTER SPEAKING WITH A NUMBER OF OTHER FINANCIAL ADVISORS, APPROACHED THE REPRESENTATIVES WITH THE SPECIFIC OBJECTIVE OF PARTICIPATING IN A 1031 EXCHANGE. THE REPRESENTATIVES SIMPLY PROVIDED CLAIMANT WITH THE INVESTMENT OPTIONS THAT WERE AVAILABLE THROUGH LPL FOR A 1031 EXCHANGE. IN FACT, THE REPRESENTATIVES TRIED TO DISCOURAGE CLAIMANT FROM PARTICIPATING IN A 1031 EXCHANGE, AND INSTEAD SUGGESTED THAT HE TAKE THE PROCEEDS FROM THE PROPERTY SALE AND INVEST THEM IN MORE TRADITIONAL INVESTMENTS. HOWEVER, AFTER HAVING THE OPPORTUNITY TO REVIEW THE SIGNIFICANT RISK DISCLOSURES ASSOCIATED WITH THIS INVESTMENT AND CONSULTING WITH HIS ATTORNEY AND OTHER ADVISORS, CLAIMANT ELECTED TO INVEST IN THE TIC. UNFORTUNATELY, THE INVESTMENT SUFFERED LOSSES DURING THE REAL ESTATE CRISIS THAT BEGAN SHORTLY AFTER CLAIMANT MADE THE INVESTMENT. CLAIMANT THEN FILED HIS ARBITRATION IN MARCH 2013 ATTEMPTING TO HOLD LPL AND THE REPRESENTATIVES RESPONSIBLE FOR THESE MARKET LOSSES. ULTIMATELY THE FIRM ELECTED TO SETTLE THIS ARBITRATION, DUE TO THE SIGNIFICANT COSTS ASSOCIATED WITH TRYING SUCH A COMPLICATED MATTER AND THE INHERENT UNCERTAINTY IN LITIGATION, WITHOUT ANY FINANCIAL CONTRIBUTION FROM THE REPRESENTATIVES.