Cetera Shutters J.P. Turner, Claims Move Is Not Part of Broader Firm Consolidation

Cetera Financial Group is shutting down one of its brokerage firms, J.P. Turner & Co., shortly after its purchase. Larry Roth, the independent financial network’s CEO, told InvestmentNews that the move is not part of a broader consolidation involving its different firms.

About half of J.P. Turner’s 300 investment advisers have been invited to work at Summit Brokerage Services Inc., which is also owned by Cetera. Roth has indicated the reason for the closing of J.P. Turner is so its advisers can more swiftly access the complete spectrum of support and services offered by Cetera’s network through business-to-business provider Pershing, LLC. J.P. Turner had worked with a different clearing firm as, reportedly, Pershing had refused to do business with J.P. Turner because of their checkered past.

According to Securities Lawyer and Shepherd Smith Edwards Partner Sam Edwards, “It is not surprising Pershing did not want to clear trades for J.P . Turner as the firm has long had a reputation among those in the industry, and especially attorneys representing customers, as one willing to take on brokers and allow trading that other firms would not permit. This has resulted in our firm representing many J.P. Turner clients over the years and those cases have been among some of the more egregious we have seen.”

On the Financial Industry Regulatory Authority’s BrokerCheck.com, J.P. Turner is linked to 36 disclosure items, including a dozen arbitrations and two dozen regulatory actions. In addition to its questionable regulatory past, J.P. Turner had recently developed a name as a seller of nontraded real estate trusts and other alternative investments.

The broker-dealer and Summit were acquired under the Cetera umbrella by RCS Capital Corp. (RCAP) last year when former RCAP executive chair Nicholas Schorsch decided to purchase a slew of brokerage firms. At the time of the acquisition it was announced that the firms would stay separate entities.

Prior to its acquisition by RCAP, FINRA fined J.P. Turner more than once for different violations. In 2013, for example, the self-regulatory organization ordered the firm to pay over $750,000 in restitution for selling inverse and leveraged exchange-traded funds that were unsuitable, as well as for excessive mutual fund switches. The broker-dealer settled without denying or admitting to the findings.

If you are or were a client of J.P. Turner and suspect your investments were mismanaged in any way, please contact our securities lawyers for a free, no obligation consultation with one of our attorneys.

Cetera Shuts Down J.P. Turner, Financial Planning, July 30, 2015

FINRA Fines J.P. Turner, LaSalle St. Securities, and H. Beck For Report Supervision Lapses, Institutional Investor Securities Blog, March 30, 2015
FINRA Orders J.P. Turner to Pay $707,559 in Exchange-Traded Fund Restitution to 84 Clients, Stockbroker Fraud Blog, December 10, 2013