David Gordon Smith – 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 David Gordon Smith.
The stock market is a device for transferring money from the impatient to the patient… Warren Buffet
BrokerComplaints.com is currently investigating allegations related to David Gordon Smith. We provide a free platform for investors to help them in their claims against negligent brokers and brokerage firms.
About David Smith
David Gordon Smith is an Investment Adviser. David Gordon Smith’s Central Registration Depository (CRD) number is 2807532 and the FINRA Profile can be found at – https://brokercheck.finra.org/individual/summary/2807532.
Click here to download a Detailed Audit Report for David Gordon Smith.
David Gordon Smith 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 David Gordon Smith’s regulatory actions, arbitrations, and complaints.
DISCLOSURE 1 –
- Event Date: 7/22/2011
- Disclosure Type: Customer Dispute
- Disclosure Resolution: Denied
- Disclosure Detail :: Allegations: NC RESIDENT CLAIMS MISREPRESENTATION WITH REGARD TO SEVERAL FEATURES OF A VARIABLE ANNUITY CONTRACT PURCHASED FROM RIVERSOURCE IN NOVEMBER 2007. SHE HAS REQUESTED REIMBURSEMENT OF LOSS, SURRENDER PENALTY, TAXES, AND FEES TOTALING $20,212.02.
- Damage Amount Requested: $20,212.02
- Broker Comment: DURING 2008 AT THE MARKET DECLINE, I REVIEWED HER ACCOUNT AND DISCUSSED INCOME RIDER, DEATH BENEFIT VALUE AND [CUSTOMER SEEMED COMPLETELY SATISFIED WITH THE RIDERS AND SAFETY THAT THE RIDERS PROVIDED HER EVEN WITH THE MARKET DECLINE. SHE WAS NOT MAKING ANY WITHDRAWLS AT THAT TIME AND UNDERSTOOD MARKET FLUCATIONS WOULD AFFECT THE CURRENT VALUE BUT HER 6% INCOME FOR LIFE WOULD BE BASED OFF OF GUARANTEED VALUE.
DISCLOSURE 2 –
- Event Date: 2/18/2011
- Disclosure Type: Customer Dispute
- Disclosure Resolution: Settled
- Disclosure Detail :: Allegations: NC RESIDENT CLAIMS HE WAS SOLICITED WACHOVIA STOCK ON 9/18/2008 WITH CLAIMS THAT CITIBANK WAS GOING TO PURCHASE WACHOVIA AND STOCK WOULD INCREASE. UNREALIZED LOSS IN IRA AND JOINT ACCOUNT ON WACHOVIA/WELLS FARGO STOCK IS $8,834.97.
- Damage Amount Requested: $8,834.97
- Settlement Amount: $8,000.00
- Broker Comment: CUSTOMER’S ALLEGATIONS ARE INCORRECT. NO SOLICIATION TOOK PLACE, CUSTOMER IS ANGRY WITH WACHOVIA AND WANTS FUNDS FROM THEIR PURCHASE OF WACHOVIA STOCK. I DO NOT SELL STOCK. I DID NOT SOLICIT CUSTOMER, NEVER SOLD ANY WACHOVIA STOCK AND NEVER DISCUSSED ANY POTENTIAL CITIBANK MERGER. THIS IS A SOPHICIATED AND EXPERIENCED CLIENT WITH A LARGE PORTFOLIO INVESTED IN A RIVERSOURCE ANNUITY TO HAVE SAFETY OF PRINCIPAL THAT RIDERS PROVIDE. ALL TRADES WERE PLACE THROUGH SALES ASSISTANT, JUDY BLACK, WHO DOES NOT REMEMBER PLACING ANY TRADES FOR THIS CUSTOMER. ANY COMMENTS TO PURCHASE WACHOVIA STOCK WOULD HAVE BEEN COMMENTS HE HEARD ON CNN REGARDING A MERGER. I DO NOT SOLICIT STOCK TRADES.
DISCLOSURE 3 –
- Event Date: 4/14/2010
- Disclosure Type: Customer Dispute
- Disclosure Resolution: Denied
- Disclosure Detail :: Allegations: NC RESIDENT PURCHASED A RIVERSOURCE V/A ON 8/27/2007. BASED ON PRESENTATION MATERIALS, THE CLIENT BELIEVES HIS DEATH BENEFIT WAS MISREPRESENTED. HENCE, HE WOULD LIKE THE POLICY RESCINDED AND THE PREMIUM RETURNED. THE DECLINE IN VALUE IS PRESENTLY $12, 453.70 (08/27/2007)
- Damage Amount Requested: $12,453.70
- Broker Comment: I WAS NEVER CONTACTED REGARDING THIS CLIENT BY WACHOVIA SECURITIES TO DISCUSS ANY OF THE DETAILS IN THIS MATTER. THE INFORMATION PLACED ON MY U4-REGISTRATION REGARDING THIS CLIENT IS VERY VAGUE, AND SINCE THE CLAIM BY THE CLIENT IS IN REGARDS TO THE DEATH BENEFIT THE LOSS OF VALUE THAT IS BEING REFERENCED WOULD HAVE NO EFFECT ON THE POLICY VALUE. THE DEATH BENEFIT VALUE AND THE POLICY VALUE ARE TWO SEPARATE ISSUES,AND A CONTRACT HOLDING CAN NOT SUFFER A LOSS OF VALUE ON A DEATH BENEFIT. THIS APPEARS TO BE ANOTHER EXAMPLE OF WACHOVIA SECURITIES MAKING ANOTHER NEGATIVE REPOPRTING ON MY U-4 REGISTRATION WHEN IN FACT THERE IS NO MISREPRESENTATION ON THE DEATH BENEFIT ON THIS CLIENTS POLICY, AND IT WOULD HAVE BEEN VERY SIMPLE FOR WACHOVIA SECURITIES TO PRINT OFF A COPY OF THIS CLIENTS VALUES. SINCE THERE WAS NO LOSS OF VALUE TO THE CLIENTS POLICY AND CLEARLY SHOW HIM THE DEATH BENEFIT VALUES AS WELL AS THE CURRENT POLICY VALUES. SINCE THERE WAS NO LOSS VALUE TO THIS CLIENT REGARDING ANY DEATH BENEFIT VALUES THERE SHOULD NOT HAVE BEEN ANYTHING TO REPORT ON MY U4-REGISTRATION BY WACHOVIA SECURITIES.
DISCLOSURE 4 –
- Event Date: 12/16/2009
- Disclosure Type: Customer Dispute
- Disclosure Resolution: Settled
- Disclosure Detail :: Allegations: NC RESIDENT PURCHASED RIVERSOURCE VA ON 12/21/07 WITH $72,143.50 PREMIUM. CLIENT SAYS THEY WERE TOLD PREMIUM WAS GUARANTEED AND WOULD BE RETURNED WITH 6% INTEREST IN THREE YEARS. THEY HAVE NOW LEARNED THAT POLICY IS FOUR YEARS, DOES NOT HAVE PRINCIPAL GUARANTEE, NOR DOES IT HAVE A RIDER THAT RETURNS PREMIUM IN THE FORM OF AN INCOME STREAM.THE MATTER WAS SETTLED FOR $17,654.73.
- Damage Amount Requested: $17,500.00
- Settlement Amount: $17,654.73
- Broker Comment: WELLS FARGO COMPLICANCE CALLED IN DECEMBER AND STATED THAT THEY RECEIVED A VERBAL COMPLAINT FROM [FAMILY MEMBER THE SON WHO IS NOT THE POLICY OWNER AND THEY TOLD ME THAT THEY WOULD BE DENYING THE CLAIM. WHEN WELLS FARGO CALLED THEY DISCUSSED ALL DETAILS OF THIS POLICY AND HOW IT WAS WRITTEN. THE CLIENT SPECIFICALLY WANTED TO LEAVE THESE FUNDS TO THE CHILDREN AT HER DEATH. SHE HAD NO INCOME NEEDS AT THAT TIME BUT AFTER I LEFT WELLS FARGO THE SON CAME TO SEE ME TO TRY TO GET FUNDS FROM THE POLICY. HE STATED THAT IF THE FUNDS WERE STILL LIQUID THAT HE COULD USE THE FUNDS TO PURCHASE CARS AT AUCTION FOR HIS USED CAR BUSINESS. WHEN THIS POLICY WAS FIRST PURCHASED AFTTER THE DEATH OF HER SPOUSE, I MET WITH THIS CUSTOMER WITH [OTHER FIRM EMPLOYEE MY JUNIOR BROKER AND HER TWO SONS AND HER DAUGHTER. ALL ASPECTS OF THIS POLICY WAS EXPLAINED TO EACH CHILD AND THE MOTHER. THERE WERE SIX PEOPLE AT THIS MEETING LISTENING TO ALL THE DETAIL OF RIVERSOURCE. THE PURPOSE OF THESE FUNDS ACCORDING TO THE MOTHER WAS NOT FOR HER SONS USED CAR BUSINESS. SINCE WELLS FARGO CALLED ME IN DECEMBER BECAUSE THE SON WANTED THE FUNDS AND THEY DENIED THE CLAIM, I AM ASSUMING THAT HE PUT HIS MOTHER UP TO MAKING A VERBAL COMPLAINT WITH OUT ANY MERIT. SINCE HE WAS IN THE MEETING AND AGREEMENT TO THE ANNUITY WITH RIVERSOURCE AND EACH CHILD AND MOTHER AGREED SEPARTELY. I HAVE THEIR AGREMENT ALSO MY JUNIOR BROKER WAS IN THE MEETING ALSO. I COULD NOT AND WOULD NOT DECEIVE ANY CUSTOMER INTO THINKING A VARIABLE ANNUITY WOULD BE FOR 3 YEARS AND SIX PEOPLE IN THE OFFICE HEAR 4 YEAR CONTRACT. THIS IS ONLY A WAY FOR THE SON TO GET FUNDS SINCE HE TRIED TO GET THEM BEHIND THE CUSTOMER’S BACK AND I WOULD NOT DISCUSS HER ACCOUNT WITH HIM SINCE HE DOES NOT HOLD THE POA. ALSO NOT THAT [FAMILY MEMBER THREATENED ME BY STATING \IF HE EVER CAUGHT ME OUTSIDE HE WOULD CAUSE ME BODILY HARM\. I AM SAYING IT IN A NICE WAY WHICH IS NOT THE WAY HE STATED IT. HE STATED THAT HE COULD HAVE TAKEN THE FUNDS AND DID MORE BY BUYING CARS AT THE AUCTION. WHERE ARE THE DAUGHTER AND OTHER SON IN THIS PROCESS BECAUSE THIS IS [FAMILY MEMBER ONLY NOT [CUSTOMER.
DISCLOSURE 5 –
- Event Date: 11/30/2009
- Disclosure Type: Customer Dispute
- Disclosure Resolution: Settled
- Disclosure Detail :: Allegations: NC RESIDENT STATED THAT FA SOLICITED PURCHASE OF WACHOVIA STOCK AND LEHMAN BROTHERS STOCK FOR HIS PERSONAL AND UGMA ACCOUNTS ON THE BASIS THAT THE FIRMS WOULD BE BOUGHT AND THE STOCK WOULD GO UP AND MAKE UP FOR THE LOSSES. CLIENT WOULD LIKE TO BE REIMBURSED FOR FULL LOSS ON ALL WACHOVIA AND LEHMAN POSITIONS IN THE AMOUNT OF $28,315.03. (09/11/2008)
- Damage Amount Requested: $28,315.03
- Settlement Amount: $19,359.68
- Broker Comment: THE FIRM SETTLED THE VERBAL COMPLAINT FOR $19,359.68. CUSTOMER CAME INTO THE BRANCH DAILY TO MAKE HIS COMMERCIAL DEPOSITS FOR HIS BUSINESS ACCOUNTS, THIS LEAD HIM TO COME INTO MY OFFICE AS WELL AS THE FINANCIAL SPECIALIST OFFICE FREQUENTLY TO DISCUSS THE STOCK MARKET AND WACHOVIA’S PROBLEMS IN THE MARKET. [CUSTOMER IS AN EXPERIENCED INVESTOR AND WAS FOLLOWING THE NEWS OF THE MARKET. HE DECIDED TO PURCHASE WACHOVIA STOCK AFTER THE COMMENTS FROM ROBERT STEEL ON JIM CRAMER’S MAD MONEY SHOW. HE ACCEPTED THE RECOMMENDATION THAT THE STOCK (WACHOVIA) WAS A BUY AND HOLD.
DISCLOSURE 6 –
- Event Date: 2/9/2009
- Disclosure Type: Customer Dispute
- Disclosure Resolution: Settled
- Disclosure Detail :: Allegations: SC RESIDENT PURCHASED RIVERSOURCE VA ON 6/5/07 WITH $44,649 PREMIUM. CLIENT NEVER WENT TO SCHOOL, CANNOT READ OR WRITE, AND SAYS HE DIDN’T UNDERSTAND THE CONTRACT. LOSS AND CDSC ARE $15, 568.58
- Damage Amount Requested: $21,655.23
- Settlement Amount: $21,655.23
- Broker Comment: AS A BUSINESS DECISION,AND WITHOUT ADMITTING ANY LIABILITY ON THE PART OF THE FIRM, THE MATTER WAS SETTLED FOR $21,655.23
DISCLOSURE 7 –
- Event Date: 1/30/2009
- Disclosure Type: Customer Dispute
- Disclosure Resolution: Settled
- Disclosure Detail :: Allegations: NC RESIDENT STATED THAT HIS FA INVESTED HIM TOO AGGRESSIVELY CONTRARY TO HIS REQUEST FOR A CONSERVATIVE ALLOCATION. CLIENT WAS IN FUNDSOURCE FROM 7/07 – 11/08 AND THEN PURCHASED CITIGROUP, LEHMAN BROTHERS, AND WACHOVIA AND ALTOGETHER LOST ABOUT $150,000. CLIENT RECOGNIZES THAT MARKET IS DOWN AND WANTS TO BE COMPENSATED FOR EXCESSIVE LOSS.
- Damage Amount Requested: $29,069.00
- Settlement Amount: $29,069.00
- Broker Comment: AS A BUSINESS DECISION, AND WITHOUT ADMITTING ANY LIABILITY ON THE PART OF THE FIRM, THE MATTER WAS SETTLED FOR $29,069.
DISCLOSURE 8 –
- Event Date: 1/2/2009
- Disclosure Type: Employment Separation After Allegations
- Disclosure Resolution:
- Disclosure Detail :: Firm Name: WACHOVIA SECURITIES, LLC
- Termination Type: Voluntary Resignation
- Allegations: CUSTOMERS ALLEGED THAT SMITH SOLICITED TRADES IN WB, AN ALLEGATION SMITH DENIED.
- Broker Comment: CUSTOMERS VIEWED [THIRD PARTY ON JIM CRAMER’S MAD MONEY ON CNN ON (9/15/08) AND DECIDED TO PURCHASE WB WITHOUT MY SOLICATION. SEE WINSTON-SALEM JOURNAL ARTICLE ON 1/27/2009 IN REFERENCE TO WB AND SEC (FROM WSJ). CUSTOMERS DID NOT HEED MY ADVISE THAT INDIVIDUAL STOCKS POSE A MUCH GREATER RISK. I DISPUTED THESE COMPLAINTS WITH WACHOVIA PRIOR TO MY RESIGNATION. THESE COMPLAINTS SHOULD BE REMOVED FROM MY RECORD.
DISCLOSURE 9 –
- Event Date: 7/19/2007
- Disclosure Type: Customer Dispute
- Disclosure Resolution: Settled
- Disclosure Detail :: Allegations: CUSTOMER PURCHASED TWO VA’S IN NOV OF 2000. CUSTOMER ALLEGES THAT THEY WERE ILL ADVISED REGARDING THE SECURED FUTURE OPTION ON ONE OF THE VA’S AND ALLEGES THEY WERE MISLED REGARDING THE AMOUNT OF INCOME THEY SHOULD OR WERE ABLE TO TAKE OFF THE OTHER VA.
- Damage Amount Requested: $67,876.00
- Settlement Amount: $12,900.00
- Arbitration Docket Number:
DISCLOSURE 10 –
- Event Date: 10/16/1978
- Disclosure Type: Criminal
- Disclosure Resolution: Final Disposition
- Disclosure Detail :: Criminal Charges :: Charges: BURGLARY OF A BUILDING WITH INTENT TO COMMIT THEFT A FELONY CHARGE, BUT UPON MOTION OF THE STATE, THE OFFENSE WAS REDUCED TO A CLASS C MISDEMEANOR CRIMINAL TRESPASSING
- Charge Type: FELONY
- Disposition: PLED GUILTY TO THE OFFENSE OF CRIMINAL TRESPASSING A CLASS C MISDEMEANOR AND ASSESSED THE FINE OF $200.
- Broker Comment: I WAS ON THE CONTRUCTION SITE OF A TOWNHOME THAT I WAS BUYING IN HOUSTON, TEXAS WITH A FRIEND SHOWING HIM THE CONSTRUCTION SITE WHERE MY TOWNHOUSE WAS BEING BUILT. THE SECURITY GUARD FOR THE PROJECT APPROXIMATELY CALLED THE POLICE WHO ARRESTED US BOTH AND CHARGED US WITH BURGLARY.
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.
- SUNTRUST INVESTMENT SERVICES, INC. (CRD#: 17499) :: 1/7/2009 – 9/10/2012 :: HIGH POINT, NC
- WACHOVIA SECURITIES, LLC (CRD#: 19616) :: 7/19/2002 – 1/30/2009 :: WINSTON-SALEM, NC
- BB&T INVESTMENT SERVICES, INC. (CRD#: 33856) :: 12/2/1999 – 7/1/2002 :: CHARLOTTE, NC
- FIRST UNION BROKERAGE SERVICES, INC. (CRD#: 8112) :: 5/20/1998 – 11/30/1999 :: CHARLOTTE, NC
- DEAN WITTER REYNOLDS INC. (CRD#: 7556) :: 11/22/1996 – 2/4/1998 :: PURCHASE, NY
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 David Gordon Smith, 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.
Sometimes investment losses occur because advisors, stockbrokers, and even brokerage firms, commit fraud. Massimo Vignelli
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 David Smith
In order to prevail in an investment fraud lawsuit or FINRA arbitration cases, you must be able to assert a viable ‘cause of action’.
David Gordon Smith – 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 (2807532) for the broker – David Gordon Smith
- 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.