Stoltmann Law Offices, P.C. is evaluating investor claims in connection with recently disbarred financial advisor Philip Nalesnik from Pottsville, Pennsylvania. According to a document signed by Mr. Nalesnik on April 15, 2019, he voluntarily consented to a permanent bar from FINRA. This is a professional death sentence for anyone who wants to provide financial services or financial advice to clients. The Acceptance, Waiver, and Consent (AWC) states that Mr. Nalesnik refused to provide on-the-record testimony to FINRA in connection with its investigation into his outside business activities. Prior to signing the AWC, according to his FINRA BrokerCheck Report, Mr. Nalesnik was terminated for cause by LPL Financial on July 8, 2018 as a result of LPL’s internal investigation into his outside businesses, including not cooperating with LPL’s investigation.
Mr. Nalesnik’s FINRA BrokerCheck Report reveals a few other troubling red flags. He has been named in five customer complaints, with one of them resulting in an adverse arbitration award in November 2010. He filed for Chapter 7 bankruptcy protection in January 2012 and more recently, was hit with two tax liens. Financial troubles like these can be red flags or indications that a financial advisor could slip into various forms of misconduct, including selling away, where an advisor has investor-clients invest money in an outside entity without the formal authorization of his firm.
Mr. Nalesnik did prominently disclose several outside businesses on his CRD Report. These include Ridgeview Wealth Management which was disclosed as a company through which Mr. Nelsnik sold non-variable insurance products. He also disclosed Integrated Insurance Management, LLC which looks to be an insurance agency. Mr. Nalesnik also reports an affiliation with Private Advisor Group, LLC, which is a registered investment advisory firm headquartered in Morristown, New Jersey. Doing business with any of these entities would be required to be supervised by LPL Financial.
There are any number of reasons a financial advisor may give up his securities licenses, as opposed to sitting for an on-the-record (OTR) interview under oath. But the most common reason is the most obvious one: the broker does not want to be under oath or admit anything to the regulator that could result in further sanctions or even prosecution. Refusing to appear for an OTR combined with allegations of operating undisclosed outside businesses is a call-sign that a financial advisor may be selling-away. Brokerage firms like LPL Financial have an obligation to supervise the activities of its financial advisors and could be liable for any losses sustained as a result of selling away activities.
If you invested money with Mr. Nelsnik or LPL Financial and are concerned about your investments, please contact Stoltmann Law Offices at 312-332-4200 for a no-obligation, free consultation with an experienced investor-rights attorney. We are a contingency fee law firm, which means we do not get paid until you do.