Allerton Towne Audit (2023) – A Scam or Legit Broker?

Allerton Towne  – 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 Allerton Towne.

BrokerComplaints.com is currently investigating allegations related to Allerton Towne. We provide a free platform for investors to help them in their claims against negligent brokers and brokerage firms.

About Allerton Towne

Allerton Towne is an Investment Adviser. Allerton Towne’s Central Registration Depository (CRD) number is 1212315 and the FINRA Profile can be found at – https://brokercheck.finra.org/individual/summary/1212315.

Click here to download a Detailed Audit Report for Allerton Towne.

Allerton Towne 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 Allerton Towne’s regulatory actions, arbitrations, and complaints.

DISCLOSURE 1 – 

• Event Date: 6/20/2008
• Disclosure Type: Regulatory
• Disclosure Resolution: Final
• Disclosure Detail :: DocketNumberFDA: 2005003031001
• DocketNumberAAO: 2005003031001
• Initiated By: FINRA
• Allegations: NASD RULES 2110, 2330, 3030, 8210 – ALLERTON TOWNE MADE IMPROPER USE OF FUNDS BELONGING TO A PUBLIC CUSTOMER; TOWNE INTENTIONALLY AND WITHOUT AUTHORIZATION CONVERTED MONEY BELONGING TO THE CUSTOMER BY WIRING $4,181.81 FROM THE CUSTOMER’S ACCOUNT TO A BANK ACCOUNT IN THE NAME OF A CORPORATION HE CONTROLLED; ENGAGED IN OUTSIDE BUSINESS ACTIVITY, FOR COMPENSATION, OUTSIDE THE SCOPE OF HIS RELATIONSHIP WITH HIS MEMBER FIRM AND FAILED TO GIVE HIS FIRM NOTICE OF THE ACTIVITIES; AND FAILED TO RESPOND TO FINRA REQUESTS FOR DOCUMENTS.
• Resolution: Decision
• Sanction Details :: Sanctions: Bar (Permanent)
• Regulator Statement: DEFAULT DECISION RENDERED JANUARY 27, 2009 WHEREIN TOWNE IS BARRED FROM ASSOCIATION WITH ANY FINRA MEMBER IN ANY CAPACITY. AMENDED DEFAULT DECISION RENDERED JANUARY 30, 2009 WHEREIN TOWNE IS BARRED FROM ASSOCIATION WITH ANY FINRA MEMBER IN ANY CAPACITY. DECISION AMENDED TO ADD INADVERTENTLY OMITTED REFERENCES TO RESPONDENT’S VIOLATIONS OF RULE 2330 FOR THE MISUSE OF FUNDS. DECISION IS FINAL FEBRUARY 27, 2009.

DISCLOSURE 2 – 

• Event Date: 4/9/1999
• Disclosure Type: Regulatory
• Disclosure Resolution: Final
• Disclosure Detail :: DocketNumberFDA:
• Initiated By: IN
• Allegations: DISCIPLINARY HISTORY RAISED QUESTIONS REGARDING ISSUING AN AGENT REGISTRATION IN INDIANA.
• Resolution: Order
• Sanction Details ::
• Sanction Details: FILED AN ORDER OF RESTRICTIVE AGREEMENT 4/9/1999
• Broker Comment: N/A

DISCLOSURE 3 – 

• Event Date: 12/3/1990
• Disclosure Type: Customer Dispute
• Disclosure Resolution: Award / Judgment
• Disclosure Detail :: Allegations: CLAIMANT ALLEGED THAT RESPONDENTS TOWNE AND G.K. SCOTT & CO., SOLD 40000 SHARES OF A PENNY STOCK AFTER THE SELL ORDER EXPIRED. CLAIMANT REQUESTED DAMAGES OF $18,750.00 PUNITIVE DAMAGES, COSTS AND ATTORNEY’S FEELS.
• Damage Amount Requested: $18,750.00
• Damages Granted: $3,066.96
• Arbitration Claim Filed Detail: 90-03117
• Arbitration Docket Number:
• Broker Comment: AWARD WAS MADE BY BOTH RESPONDENTS OF $2800.00 PLUS INTEREST OF $266.96 FOR A TOTAL OF $3066.96. CLAIMANTS REQUEST FOR ATTORNEY’S FEES, COSTS, AND PUNITIVE DAMAGES WERE DENIED. RESPONDENTS DENIED ALL ALLEGATIONS OF WRONGDOING AND ALLEGED THAT CLAIMANTS INSTRUCTIONS TO SELL THE STOCK WERE FOLLOWED; THE TRADE WAS AUTHORIZED AND RATIFIED; AND THAT CLAIMANT ONLY COMPLAINED WHEN THE PRICE OF THE STOCK ROSE WELL AFTER THE TRADE.

DISCLOSURE 4 – 

• Event Date: 2/9/1977
• Disclosure Type: Regulatory
• Disclosure Resolution: Final
• Disclosure Detail :: DocketNumberFDA:
• Initiated By: PENNSYLVANIA
• Allegations: FINDINGS OF FACT,CONCLUSIONS OF LAW AND ORDER ISSUED TO TOWNE DENYING FOR FIVE YEARS FROM THE DATE OF THE COMMISSION’S ORDER ANY EXEMPTION PURSUANT TO SECTIONS 202 OR 203 OFFERING OR SELLING SECURITIES IN PENNSYLVANIA, OF WHICH TOWNE IS AN OFFICER, DIRECTOR, PROMOTER, AFFILIATE OR ASSOCIATE AND ALSO DENIED ANY APPLICATION FOR REGISTRATION PURSUANT TO SECTION 301 OF THE PA SECURITIES ACT OF TOWNE FOR FIVE YEARS FROM THE DATE OF THE COMMISSION’S ORDER.
• Resolution: Order
• Sanction Details :: Sanctions: Revocation/Expulsion/Denial
• Sanction Details: FINDINGS OF FACT,CONCLUSIONS OF LAW AND ORDER ISSUED TO TOWNE DENYING FOR FIVE YEARS FROM THE DATE OF THE COMMISSION’S ORDER ANY EXEMPTION PURSUANT TO SECTIONS 202 OR 203 OFFERING OR SELLING SECURITIES IN PENNSYLVANIA, OF WHICH TOWNE IS AN OFFICER, DIRECTOR, PROMOTER, AFFILIATE OR ASSOCIATE AND ALSO DENIED ANY APPLICATION FOR REGISTRATION PURSUANT TO SECTION 301 OF THE PA SECURITIES ACT OF TOWNE FOR FIVE YEARS FROM THE DATE OF THE COMMISSION’S ORDER.
• Broker Comment: NEITHER I OR DREXEL LEASING CORP RECEIVED A FINDINGS OF FACT, CONCLUSION OF LAW & ORDER DATED 2/9/77 FROM THE STATE OF PENNSYLVANIA. WHEN I APPLIED FOR REGISTRATION AS A SECURITIES SALEPERSON LATER ON, I DID NOT DISCLOSE THE EVENT ON MY FORM U-4, AS I WAS UNAWARE IT EXISTED. AFTER THE PENNSYLVANIA SECURITIES DIVISION REVIEWED THE MATTER, THEY IMMEDIATELY ACCEPTED MY REGISTRATION.

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.

Previous Associations

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.

• SOURCE CAPITAL GROUP, INC. (CRD#: 36719) :: 12/1/2001 – 9/20/2006 :: BOCA RATON, FL
• MERIT CAPITAL ASSOCIATES, INC. (CRD#: 30576) :: 6/3/1998 – 12/1/2001 :: WESTPORT, CT
• ARGENT SECURITIES, INC. (CRD#: 15297) :: 2/19/1998 – 5/15/1998 :: ATLANTA, GA
• NICHOLS, SAFINA, LERNER & CO. INC. (CRD#: 35476) :: 1/12/1998 – 1/28/1998 :: NEW YORK, NY
• THOMAS GREEN SECURITIES, INC. (CRD#: 571) :: 7/9/1997 – 12/31/1997 :: LOS ANGELES, CA
• BARBER & BRONSON INCORPORATED (CRD#: 26582) :: 9/10/1996 – 6/18/1997 :: MIAMI, FL
• LAIDLAW EQUITIES, INC. (CRD#: 19018) :: 3/17/1995 – 9/6/1996 :: NEW YORK, NY
• COMPREHENSIVE CAPITAL CORP. (CRD#: 6215) :: 9/30/1991 – 3/24/1995 :: GREAT NECK, NY
• G. K. SCOTT & CO., INC. (CRD#: 3305) :: 2/3/1989 – 9/30/1991 :: PLAINVIEW, NY
• SHEFFIELD SECURITIES, INC. (CRD#: 16475) :: 11/14/1988 – 1/19/1989
• JW CHARLES SECURITIES, INC. (CRD#: 6631) :: 3/2/1988 – 10/28/1988
• INTERSTATE SECURITIES CORPORATION (CRD#: 431) :: 12/15/1987 – 2/27/1988
• E. F. HUTTON & COMPANY INC (CRD#: 235) :: 10/23/1985 – 12/22/1987
• OPPENHEIMER & CO., INC. (CRD#: 630) :: 12/22/1983 – 10/1/1985
• CONTISECURITIES, INC. (CRD#: 6926) :: 12/22/1983 – 1/13/1984

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 Allerton Towne, 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 Allerton Towne

In order to prevail in an investment fraud lawsuit or FINRA arbitration cases, you must be able to assert a viable ‘cause of action’.

Allerton Towne – 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 (1212315) for the broker – Allerton Towne
• 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 ‘Complaints Bureau,’ 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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