Richard Wesselt

Date:

December 10, 2020

Type of alert:

FINRA AWC  

Former general securities representative Richard Wesselt consented to bar from associating with any member of the Financial Industry Regulatory Authority (FINRA) Department of Enforcement for allegedly promoting unsuitable investment strategies to 78 customers.

This alleged activity occurred while Wesselt was associated with O.N. Equity Sales Company in Collegeville, Pennsylvania from March 2014 to September 2017. Wesselt was also briefly associated with Fortune Financial Services, Inc. from September 2017 to November 2020.

According to the Letter of Acceptance, Waiver and Consent (AWC), Wesselt promoted unsuitable investment strategies that involved his customers purchasing variable annuities (intended to be long-term investments) with liquidated retirement savings. Shortly thereafter, Wesselt recommended that the customers withdraw from the annuities to purchase life insurance policies. Wesselt told many customers who were incurring high costs that they could use the cash value in their whole life insurance policies to make loans to themselves, an investment strategy that he dubbed “building your own bank” or “infinite banking.”

This investment strategy resulted in significant harm to the customers’ accounts, including high surrender charges, forfeiture of expected benefits, and fees and penalties. Further, Wesselt’s recommendations resulted in all 78 customers depleting or completing liquidating their retirement savings. Wesselt allegedly earned $686,025 in commissions on the sale of the variable annuities to these customers.

Finally, Wesselt caused his firm to keep inaccurate records by having customers sign incomplete and blank pages of various securities documents.

Wesselt’s FINRA BrokerCheck report also reveals numerous disclosures including six pending customer disputes related to the alleged violations stated in the AWC, with damage requests ranging from $5,000 to $10 million. Wesselt also has nine customer disputes since 2016 with settlements ranging from $15,000 to $275,000.

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