Complaint: Chris Passero Recommended Ponzi Scheme to Client

Chris Passero (CRD# 2517681[1]), a broker registered with Money Concepts Capital, recommended unsuitable investments in alleged Ponzi-like scheme GPB Capital, according to an investor dispute. This information can be found in his Financial Industry Regulatory Authority (FINRA) BrokerCheck report, accessed on June 29, 2023. The record identifies Mr. Passero as the president of Passero Financial Group, with which he is registered in Hurricane, West Virginia.

Investor: Passero Misrepresented GPB Investment

On May 1, 2023, an investor lodged a dispute alleging that Mr. Passero breached his fiduciary duty, recommended unsuitable securities, and misrepresented and omitted material information connected to “the sale of GPB investments.” GPB Capital is an alleged Ponzi-like investment[2] scheme whose former CEO recently pleaded guilty[3] to wire fraud. The dispute, which remains pending, seeks damages of $250,000.

FINRA: Passero Improperly Shared in Losses

The Financial Industry Regulatory Authority sanctioned Mr. Passero in April 2022, according to his BrokerCheck record. While he did not admit to or deny the regulator’s allegations, Mr. Passero consented to the entry of findings that he shared in customers’ losses. FINRA’s findings allege that he paid customers a total of $249,560 “to compensate them for losses associated with investments that he had recommended,” while failing to inform his member firm of these payments or to seek its authorization to make them. FINRA found additionally that he falsely stated in firm compliance questionnaires “that he did not share directly or indirectly in customers’ losses.”

The sanction alleged as well that he gave a customer a loan of $10,000 “to assist the customer in paying a tax liability,” failed to inform his member firm about this loan, and “falsely stated in a compliance questionnaire that he did not loan money to customers.” FINRA ordered him to pay a fine of $10,000 and suspended him from registering with any member firm in any capacities for a duration of three months.

FINRA Prohibits Improper Loss Sharing

FINRA Rule 2150 prohibits brokers from sharing in customer losses except under certain conditions, including the receipt of prior written authorization from the broker’s member firm.

Past Disputes Alleged Fraud, Suitability Violations

Two investors filed disputes involving Mr. Passero between March 2020 and February 2021. One dispute concerned an investment in GPB Capital; the other involved an unspecified non-traded real estate investment trust. The disputes alleged a range of misconduct, including unsuitable investment recommendations, violations of state and federal securities law, breach of contract, fraud, negligence, breach of fiduciary duty, and civil conspiracy. The disputes settled for a total of $139,500.

Chris Passero Based in Hurricane, Nevada

Chris Passero began his career as a broker when he started working at Money Concepts Capital Corporation in 1994. He is based in the firm’s branch office in Hurricane, Nevada, and is also the president of Passero Financial Group. With 28 years of experience as a broker, he has passed one state securities law exam and three general industry/products exams, including the Series 7 and the Series 6.

Lose Money with Chris Passero?

You have rights as an investor, and you may have grounds to file a FINRA arbitration claim to recover your losses. Call MDF Law at 800-767-8040 for a free consultation with one of our attorneys. We take all cases on a contingency basis and offer free consultations nationwide. Don’t delay — call MDF Law today.