M Holdings Advisors Have Disclosed a Pending $1.2 Million Customer Complaint Related to a Universal Life Insurance Transaction
According to publicly available information through FINRA BrokerCheck, dually registered stockbroker and investment adviser Thomas Christopher Rapp (“Mr. Rapp”, CRD No. 1792438) and his colleague, dually registered financial adviser Patrick S. Maguire (“Mr. Maguire”, CRD No. 4892680), have each disclosed a pending customer complaint. Specifically, since December 2024, Messrs. Rapp and Maguire have each disclosed a pending customer complaint which seeks damages in excess of $1.2 million.
The pending customer complaint concerns allegations that Messrs. Rapp and Maguire “failed to exercise reasonable care and diligence in the sale of a Fixed Universal Life policy, including alleged failure to disclose the characteristics, costs and pricing of the policy. Policy signed 10/27/2021.”
Since 2004, Mr. Rapp has been affiliated with a certain independent broker-dealer, M Holdings Securities, Inc. (“M Holdings”). As well, since 2017, Mr. Maguire has been affiliated with M Holdings. Registered with M Holdings, Messrs. Rapp and Maguire conduct their securities and insurance-related business under their own shingle, through two entities, namely Eagle Rock Wealth Management, Inc. (“Eagle Rock”) and Greenberg & Rapp Financial Group, Inc. (“Greenberg & Rapp”), with their main offices in Morristown, NJ.
A long-time securities professional with nearly four decades of industry experience, Mr. Rapp first began working for PRUCO Securities Corporation in 1988 and was subsequently affiliated with 1717 Capital Management Co. For the past 20 years, he has been affiliated with M Holdings, while conducting securities and insurance business through Eagle Rock and Greenberg & Rapp. Mr. Maguire has been a registered representative with M Holdings since 2017, and also conducts his securities and insurance business through Eagle Rock and Greenberg & Rapp.
Applicable FINRA rules mandate that brokerage firms like M Holdings, and by extension their affiliated financial advisors, must perform adequate due diligence on an investment before it is recommended to an investor. Furthermore, pursuant to FINRA Rule 2111 (Suitability) a financial advisor must perform a customer-specific suitability analysis in connection with the sale of an investment product, as well as certain insurance products such as variable annuities or certain universal life insurance policies, in order to ensure that the investment is appropriate for a specific customer based on certain criteria, including that customer’s age, net worth and income, liquidity needs, experience with investing and level of sophistication, in addition to the customer’s stated objectives and risk tolerance.
Moreover, under FINRA Rule 3110 (NASD Rule 3010), brokerage firms like M Holdings must “establish and maintain a system to supervise the activities of each associated person that is reasonably designed to achieve compliance” with applicable FINRA rules, in addition to state and federal securities laws. It is critical for broker-dealers to not only establish such a supervisory system, but further to properly maintain their supervision, by among other things, periodically meeting with individual financial advisors to discuss the products they are selling and their sales methods, as well as to examine correspondence with customers. In instances where a customer suffers losses due to an inappropriate or unsuitable investment (or investment program), then the brokerage firm may well be held liable for any failure to adequately supervise their employee.
The attorneys at Giarrusso Law Group LLC have significant experience in working closely with investors to resolve all manner of issues concerning investment losses, including losses suffered due to negligence or misconduct by a financial advisor. Investors may pursue a claim to recover monies through securities arbitration before FINRA, or in some instances, through litigation. Investors who wish to discuss a possible claim may contact us by telephone at (201) 771-1115 or by email at info@gialawgroup.com for a no-cost, confidential consultation.