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Questar Capital: Information for Investors
#Brokerage Firm Reviews - #Questar Capital Corporation
Questar Capital (CRD#: 43100) is a Minneapolis, MN-based brokerage firm that is licensed to operate in 51 U.S. states and American territories. As of January 15th, 2018, the broker-dealer has 8 regulatory events listed as disclosures on its firm profile. Under securities industry regulations, brokerage firms are required to disclose certain information to the public.
Here, our investment fraud lawyers list the six most recent regulatory disclosures on this firm's profile. For full information regarding this Questar Capital disclosures, please refer to the firm's complete BrokerCheck Report. All information in this article has been obtained directly from the Financial Industry Regulatory Authority.
Questar Capital: FINRA Disclosures
Disclosure # 1
Reporting Source: Regulator
Initiated By: FINRA
Allegations: "Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it disadvantaged certain retirement plan and charitable organization customers that were eligible to purchase class A shares in certain mutual funds without a front-end sales charge. The findings stated that these eligible customers were instead sold Class A shares with a front-end sales charge or Class B or C shares with back-end sales charges and higher ongoing fees and expenses. These sales disadvantaged eligible customers by causing such customers to pay higher fees than they were actually required to pay. The findings also stated that the firm failed to reasonably supervise the application of sales-charge waivers to eligible mutual fund sales. The firm relied on its financial advisors to determine the applicability of sales-charge waivers, but failed to maintain adequate written policies or procedures to assist financial advisors in making this determination. In addition, the firm failed to adequately notify and train its financial advisors regarding the availability of mutual fund sales-charge waivers for eligible customers."
Sanction Details: "The firm was censured and required to provide FINRA with a remediation plan to remediate eligible customers who qualified for, but did not receive, the applicable mutual fund sales-charge waiver. As part of this settlement, the firm agrees to pay restitution to eligible customers, which is estimated to total $796,892 (the amount eligible customers were overcharged, inclusive of interest). In resolving this matter, FINRA has recognized the extraordinary cooperation of the firm."
Allegations: "Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it failed to maintain a significant number of electronic brokerage records, essential to its business, in non-erasable and non- rewritable format known as the "write once, read many" (worm) format, that is intended to prevent the alteration or destruction of broker-dealer records stored electronically."
Sanction Details: "The firm was censured and fined $150,000, jointly and severally."
Allegations: "Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it failed to establish and maintain adequate supervisory systems regarding its use of consolidated reports and regarding its review of certain home office email correspondence. The findings stated that the firm permitted its registered representatives to create consolidated reports using a vendor-provided system that allowed for manual entries of various assets held away from the firm."
Sanction Details: "The firm was censured and fined $125,000."
Initiated By: Pennsylvania
Allegations: "Questar Capital Corporation failed to supervise an agent who sold sham securities to both Questar and non-Questar clients and used their money on his personal and business expenses in violation of the PA Securities Act of 1972."
Sanction Details: "Questar Capital Corporation paid a $200,000.00 administrative assessment and $35,000.00 in investigative and legal costs."
Reporting Source: Self-Reported
Initiated By: Commonwealth of Kentucky, Department of Financial Institutions
Allegations: "Failure to adequately supervise the activities of a registered representative and permitting a registered representative to hold himself out as a registered investment adviser representative."
Sanction Details: "Monetary/Fine $6,250.00"
Initiated By: Commonwealth of Kentucky, Division of Securities
Allegations: "Agent Thomas Gorter (CRD# 1008601) held himself out as an investment adviser representative when he was not so registered for approximately three (3) years. Questar Capital Corporation approved advertising and business cards stating he was an IAR and failed to detect and correct the situation at several audits."
Sanction Details: "Monetary/Fine $54,668.53"