David Gibbs (CRD# 2917334) recently departed MML Investors Services over allegations involving an improper customer loan, according to Financial Industry Regulatory Authority (FINRA) records. MDF Law is investigating the former Newtown Square, Pennsylvania-based broker for similar conduct. We encourage investors with concerns about their accounts to contact us as soon as possible.
More information about the allegations against Mr. Gibbs are available in this post, based on a November 3, 2023 examination of his FINRA BrokerCheck record.
Why Did MML Fire David Gibbs?
On August 31, 2023, MML Investors Services filed a disclosure regarding Mr. Gibbs’ termination from the firm. According to the disclosure, it fired him for allegedly violating firm policy regarding “obtaining a loan from a customer.” The disclosure provides no additional context surrounding the underlying allegations.
FINRA Forbids Undisclosed Customer Loans
Under FINRA Rule 3240, brokers like Mr. Gibbs may only borrow customer funds in certain circumstances. As this important securities industry rule establishes, brokers may obtain customer loans if their member firms have rules regarding such conduct, and provided the lending arrangement complies with a few conditions. Either the customer must be an immediate family member, a financial institution that provides financing as a regular course of business (and the loan is made in its regular course of business), the broker and customer are registered with the same broker-dealer firm, and/or the lending arrangement is based on a personal relationship with the customer or a business arrangement outside their broker-customer dynamic. Rule 3240 also requires the broker to inform their firm about the loan and receive its pre-approval, except in certain circumstances involving family relationships.
MML’s History of Regulatory Sanctions
As MML Investors Services’ BrokerCheck record reflect, the firm’s history includes 25 regulatory enforcement actions. For example, in August 2022 the Massachusetts Securities Division fined the firm $250,000 over allegations it failed to reasonably supervise a representative’s variable annuity sales practices. A year earlier, FINRA censured MML and ordered it to pay $617,726 in restitution over allegations that it failed to supervise representatives’ recommendations of 529 plan share classes. And in 2021, the Massachusetts Securities Division fined the firm $4 million over allegations that it failed to supervise brokers’ social media posts about securities, trading in outside accounts of other individuals, and excessive trading in personal accounts.
FINRA: Gibbs Based in Newtown Square, Pennsylvania
David Gibbs launched his career as a broker in 1997, when he registered with New England Securities in Newtown Square, Pennsylvania. He remained at the firm until 2015, when he joined MSI Financial Services. Two years later, he registered with MML’s office in Newtown Square, where he remained until his termination in 2023. With 26 years of experience as a broker, he has completed one state securities law exam and two general industry/products exams.
Broker Fraud Victims May Have Recovery Options
If you’re a current or former David Gibbs client with concerns about your account, call MDF Law today. You may be able to recover lost funds through a FINRA arbitration case. Call 800-767-8040 for a free consultation with one of our experienced investor advocates. We takes all cases on contingency, meaning we only collect a fee when our clients win. Your time to file a claim may be limited, so don’t delay: call MDF Law today.