Douglas Schmitz, a broker and investment adviser in Fargo, North Dakota, has the subject of customer dispute disclosures alleging breach of fiduciary duty and execution failure among others, according to an investigation by investor advocate, Alan Rosca.
Investor advocate Alan Rosca, of Rosca Scarlato LLC law firm is investigating the allegations involving Douglas Gene Schmitz. Investors concerned about their investments with Schmitz are encouraged to contact attorney Rosca at 888-998-0530, via email at arosca@rscounsel.law, or through the contact form on this page.
Douglas Schmitz has been registered with Classic LLC as broker since November 2012 and he has been registered with Classic Asset Management LLC as an investment adviser since July 2006. Both firms are member firms of the Financial Industry Regulatory Authority (FINRA).
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Douglas Schmitz Has Been the Subject Customer Disputes
Publicly available information reviewed by the investor advocate Alan Rosca revealed that Douglas Gene Schmitz currently has a customer dispute disclosure filed in August 2020 as reported on his FINRA brokercheck page. According to the FINRA brokercheck page, the dispute disclosure was received on August 4 2020. The client initiated the dispute on the allegation of lack of fiduciary responsibility in connection to leveraged ETF investments. As a result of this, the client has requested $40,000 as damages for the allegation.
Another customer dispute disclosed on Doug Schmitz‘s Brokercheck was instituted in April, 2020. The customer dispute was initiated on the allegations of trade execution failure. The client in this dispute was seeking to recover $750,000 in damages, and the dispute settled for $275,000.
Generally speaking, a fiduciary duty could be described as an obligation on a party to act in the best interest of another party and put that other party’s interest above his own. It is sometimes referred to as the highest duty known to man. This obligation could arise as a result of a special relationship between the two parties. For instance, the duty could arise between an advisor and an investor.
A breach of fiduciary duty could occur when the party who is expected to act in the best interest of the other party fails to do so. In an advisor-investor relationship, it could be possibly seen where the advisor is putting their personal interest above the interest of their clients in relation to an investment decision concerning the investor.
Rules governing the conduct of financial industry members, along with the applicable jurisprudence, set forth the typical duties of an advisor as to his or her investors. Financial professionals who violate such duties could be held liable, depending on the circumstances.
All these are general considerations, not necessarily applicable to any one case, and do not constitute legal advice. Investors looking for legal advice for their particular situation should contact a qualified lawyer and discuss about the facts applicable to their specific case.
Schmitz’s Previous Employer Is the Subject of a Bankruptcy Proceeding
According to the Brokercheck disclosures, Schmitz’s former broker dealer Fintegra LLC filed for bankruptcy. Douglas Schmitz was on Fintegra‘s board of directors. In 2015, the firm lost a customer dispute filed with FINRA, BizJournal reported. The said arbitration reportedly found Fintegra liable for violating anti-fraud provisions.
These allegations were allegedly related to the sale of an unregistered security which were deemed unsuitable for the investors. The investors who lost money from these activities asked a federal judge to enforce the $1.54 million award awarded by FINRA, which subsequently led to the bankruptcy of the firm. According to publicly available information, Fintegra LLC filed a Chapter 7 liquidation which listed that it had $1.8 million in assets and $2.55 million in debt.
Finally, it is important to note that, as of the date of this article, there has not been a finding of liability as to the complaints or allegations mentioned in this article, unless otherwise indicated. Any reader should also read the original sources hyperlinked in this blog for accuracy, including any BrokerCheck report and/or record of any disciplinary or regulatory action. Those sources are incorporated by reference into the text of this blog, and are the governing materials in case of any inconsistencies or typos in this blog.
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Investor Advocates Investigating
The investor advocate of the Rosca Scarlato LLC law firm expertly advise and represents investors who are victims of broker or investment-related fraud and other misconducts and is currently investigating allegations of breach of fiduciary duty and trading execution involving Douglas Gene Schmitz.
It is important to note that the firm takes most cases of this type on a contingency fee basis and advances the case costs, and only gets paid for their fees and costs out of money recovered for clients. Attorney Alan Rosca, a securities lawyer and adjunct professor of securities regulation, has represented thousands of victimized investors across the country and around the world in cases ranging from arbitrations to class actions.
Investors who believe they lost money as a result of conducts related Douglas Schmitz’s customer dispute disclosures alleging misconduct, may contact attorney Alan Rosca for a free, no-obligation evaluation of their recovery options, at 888-998-0530, via email at arosca@rscounsel.law, or through the contact form on this webpage.