FINRA Bars Broker Christopher Black After Secret Loan From Customer

Christopher Black (CRD#5049080, aka Chris Bryan Black) is a former registered broker and investment advisor whose last known employer was LPL Financial LLC (CRD#:6413) of Statesboro, GA. His previous employers are Wells Fargo Clearing Services, LLC (CRD#:19616) of St. Simons Island, GA, State Farm V Management Corp. (CRD#:43036) of Bloomington, IL, and Linsco/Private Ledger Corp. (CRD#:6413) of Rome, GA. He has been in the industry since 2006.

Christopher Black Disclosures

Christopher Black is the subject of five disclosures, beginning with his discharge from LPL Financial on 3/30/2020. In the Form U5 submitted to FINRA on 4/30/2020, LPL stated that the firm terminated Black for entering into a loan agreement with a customer that he failed to disclose to the firm.

Following his discharge from LPL, a customer filed a dispute on 4/17/2020 alleging that Black made an “unsuitable recommendation and purchase of bond investments with regard to risk tolerance and investment objective.”  The client requested damages of $72,044.00, and the firm settled the claim for $128,936.70.

Two more customers filed disputes against Black:

• On 7/14/2020, with allegations of “misrepresentation and unsuitable recommendations with regard to the purchase of bond investments.” This claim was closed without action.
• On 10/21/2020, alleging “misappropriation of funds. Time period of claim: August 2019 – Present.” This claim is currently pending.

FINRA began its investigation into the circumstances surrounding Black’s discharge from LPL Financial, sending him a letter on November 6, 2020. The letter requested information regarding his discharge, including related documentation.

On December 7, 2020, Black engaged in a phone call with FINRA staff. He acknowledged receipt of the letter and indicated that he would not be providing the requested information at any time. In response, FINRA issued a letter of Acceptance, Waiver & Consent (AWC), barring Black from any and all affiliation with a member firm. Black signed the letter on 12/18/2020, and it became effective on 1/12/2021 when signed by FINRA counsel.

Black had no other disciplinary history with FINRA.

Should You Loan Your Broker Money?

We have seen many cases of a broker borrowing money from their clients. In most cases, they don’t disclose it to the firm they are employed with, even though most firms have strict policies regarding loans.

In order for a broker to take out a loan, FINRA’s Rule 3240 indicates:

• The firm must have a written policy on loans for its employees
• The loan arrangement meets one of the following conditions:
  • With a customer who is also an immediate family member
  • With a company that is in the business of providing loans and other financial services
  • The customer and the registered person are the same
  • The lending relationship is based on a personal relationship outside of the business one
  • The loan is based on a business relationship outside of the business one

After these conditions are met, the broker must inform their firm in writing of their intent to enter into a loan arrangement and relationship. However, the firm must also approve it.

Many people have long-standing relationships with their financial services representatives, and consider them friends. But there is always a possibility that the broker is involved in “selling away,” or selling products that their firm doesn’t handle.

It’s also possible that a broker will simply use the money for something other than what was indicated, such as personal expenses. Many participate in outside business ventures that are also undisclosed to their firm. Unfortunately, there are a few brokers that will defraud a family member just because they can.

There are hundreds of stories like this one of brokers who borrowed money from their clients. If you’re considering loaning money to your financial services representative, make sure to first check their record on FINRA’s free online tool BrokerCheck. Here you can find out of this individual has a history of “client loans” or other infractions.

Did You Invest With Christopher Black?

Silver Law Group represents investors in securities and investment fraud cases. Our lawyers are admitted to practice in New York and Florida and represent investors nationwide to help recover investment losses due to stockbroker misconduct. If you have any questions about how your account has been handled, call to speak with an experienced securities attorney. Most cases are handled on a contingent fee basis, meaning that you won’t owe us until we recover your money for you. Contact us today at (800) 975-4345 for a no-cost consultation.