FINRA Issues Sanction To Brian Engstrom For Unsuitable UIT Trades

The Financial Industry Regulatory Authority (“FINRA”) reports troubling information in regard to Oppenheimer securities broker Brian Engstrom (CRD#: 1838926, Pensacola, Florida). Not only has the financial industry watchdog sanctioned Engstrom via a three month suspension and $5,000 fine, but Oppenheimer disaffiliated with him following allegations of his bad trading practices. Here’s a brief summary of the disclosures on Engstrom’s record.

FINRA Issues Sanctions To Brian Engstrom For Unsuitable Short Term Trading Of UITS

Between April 2020 and July 2020, FINRA took away Brian Engstrom’s privilege to be a securities broker for FINRA member firms because Engstrom violated suitability rules. Notably, Engstrom traded unit investment trusts (UITs) on a short-term basis. Namely, UITs carry high costs and most of these products are long-term investments.

FINRA says that months before UITs matured, Brian Engstrom recommended for Oppenheimer clients to sell positions. Critically, the securities broker on 500 occasions recommended for clients to sell UIT positions before maturity to invest in other UITS which basically had the same if not remarkably similar objectives. Engstrom’s initiation of series-to-series rollovers was inappropriate in FINRA’s view. In fact, the financial industry watchdog mentioned that Engstrom’s poor investment advice caused clients to pay more in sales charges. His high-cost and high-frequency transactions did not pass FINRA’s suitability test. For this reason, he violated FINRA rules.

Oppenheimer Disaffiliates With Engstrom

FINRA BrokerCheck shows that Oppenheimer parted ways with Brian Engstrom in October 2016. The securities firm cited Engstrom’s trading activity in client accounts. It also appears that an Oppenheimer client complained about Engstrom’s allegedly unsuitable purchases of exchange traded funds. However, Oppenheimer denied this client’s complaint.

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