Arthur Stewart Hoffman (a/k/a Art S. Hoffman) (CRD# 3193754) has been barred from the securities industry following his failure to provide documents and information in a Financial Industry Regulatory Authority (FINRA) investigation into his suspension from employment for violation of company policies.
Hoffman began his securities career in 1999 and has been based in Glendale, Arizona for the past decade. Most recently, Hoffman was registered with Ameriprise Financial Services, LLC from 2016-2020 and prior to that, Hoffman worked for Wedbush Securities Inc. According to Hoffman’s CRD Report, published by FINRA, he was discharged from Ameriprise Financial Services LLC for “company policy violations related to outside business activities and private securities transactions.”
Customer Disputes And Other Disclosures On Hoffman’s FINRA Record
Arthur Hoffman has two customer disputes disclosed on his CRD Report. The first, from February 2016, alleges fraud, misrepresentation, breach of fiduciary duties, and negligence. This dispute was settled for $329,500.
The second dispute, which is currently pending, alleges that Hoffman recommended that the customer invest $172,688 in an entity called “Zima Global Ventures, LLC”, otherwise known as “Zima Digital Assets”. The dispute alleges that Zima is a Ponzi scheme that promised unrealistic investment returns.
Hoffman’s FINRA record also notes a bankruptcy in or around May 2020. These “financial” disclosures are important because investors should be wary of the fact that Hoffman was struggling in his personal financial affairs in recent months. This may have motivated Hoffman to recommend investments and investment strategies intended to financially benefit Hoffman to the detriment of unsuspecting investors.
Arthur Hoffman Failed To Respond To A FINRA Request For Documents And Information In Connection With A FINRA Investigation Into Hoffman’s Conduct
According to FINRA’s Letter of Acceptance, Waiver and Consent (AWC), FINRA opened an investigation into a disclosure by Hoffman’s employer that Hoffman had been suspended for company policy violations related to outside business activities and private securities transactions. In connection with that investigation, FINRA sent Hoffman a request for documents and information, which Hoffman failed to respond to.
This constitutes a violation of FINRA Rule 8210(c), which provides that “[n]o member or person shall fail to provide information or testimony” as well as Rule 2010, which requires all FINRA registrants to “observe high standards of commercial honor and just and equitable principles of trade.” Accordingly, FINRA issued a permanent bar from associating with any FINRA firm in any capacity.
Outside Business Activities And “Selling Away”
The term “selling away” refers to when brokers recommend private investments that were never approved by their employing brokerage firms. The investments are “private” in the sense that they are typically not registered with state or federal securities regulators and thus not subject to the oversight necessary to detect and prevent fraud. Unfortunately, these transactions often end up supporting illicit or nonexistent business ventures, or the funds are simply stolen by the broker
Hoffman’s termination from Ameriprise Financial Services LLC was for violation of company policy involving private securities transactions and outside business activities. Generally, if a broker is affiliated with a business venture other than his employing brokerage firm, he or she must report that affiliation to the firm as an “Outside Business Activity”. That way, the firm can monitor and supervise the broker’s activities, especially if the broker is recommending that customers invest in that Outside Business Activity.
Did You Lose Money Investing With Arthur Hoffman And Zima?
If Arthur Hoffman recommended that you invest in Zima Global Ventures or Zima Digital Assets, or if you experienced other investment losses as a customer of Hoffman’s at Ameriprise Financial Services LLC, you may have a claim in FIRNA Arbitration to recover your losses.
Silver Law Group specializes in fighting for investors who lost money to brokers and financial advisors who took advantage of their positions as trusted financial professionals to defraud their clients of hard-earned savings. Silver Law Group operates on a contingency-fee basis, so the firm does not profit unless we recover funds for you. Contact Silver Law Group toll free at (800) 975-4345 or e-mail firstname.lastname@example.org for a confidential consultation. Our attorneys represent investors nationwide in investment fraud disputes.