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The law firm of Oakes & Fosher is presently investigating the possible misconduct of former securities broker Eric Korhut. According to his publicly available FINRA BrokerCheck report, Eric Korhut has been the subject of multiple customer disputes.

Eric Korhut was a Pennsylvania based securities broker. He worked in the securities industry for nineteen years. During his career, he was registered with three different securities firms. He is no longer working as a registered securities broker in any fashion.

His Registrations

  • IDS Life Insurance Company (1999-2006)
  • Ameriprise Financial Services ( 1999-2016)
  • Vanderbilt Securities (2016-2018)

The Allegations

  • In July 2017, customers of Eric Korhut alleged that he recommended an $800,000 unsuitable variable annuity. This case is currently pending. The customer is seeking $150,000 in damages.
  • In August 2017, customers of his alleged that Eric Korhut recommended a variable annuity without disclosing the surrender charges or tax ramifications. This case was settled for $7,218.30.
  • In July of 2018, Eric Korhut was sanctioned by FINRA. The findings in this matter state that he allegedly executed ten unauthorized trades in the two of his customer’s accounts. Eric Korhut allegedly affected a $22,000 trade in Class C mutual fund shares in the account of a customer at his member firm without authorization. He also all allegedly sold nine securities, two stocks and shares in seven mutual funds, totaling $27,004 in the account of the other customer without obtaining their authorization. Due to these allegations, Eric Korhut was fined $5,000 and suspended for a period of one month. He had resigned from his position at Ameriprise Financial Services two years prior when the allegations first came to light.

What Does This Mean?

Securities brokers have a duty to their customers to always act in their best financial interests. A major part of this means that they always have to obtain their customers’ authorization before they can execute trades on their behalf. There is a trading practice known as discretion where securities brokers can make trades in investors’ accounts without having to obtain authorization for every trade. Before brokers can begin engaging in discretionary trading, they must first receive express written permission from the account holder, and have their member firm deem the account in question as suitable for discretionary trading.

Discretionary trading can be a very slippery slope. When investors authorize their brokers to begin exercising discretion in their account, it gives them an excess of power over it. It allows the broker the opportunity to purchase securities the investor is not suited for. It also allows them the opportunity to trade the investor’s account to an excessive degree which results in unnecessary fees and trading losses.

Oakes & Fosher Can Help

Many investors are unaware of the legal recourse available to them after losing money due to securities broker fraud and/or negligence. The truth is that investors who have lost money in this fashion may actually be entitled to damages.

Oakes & Fosher dedicates its entire legal practice to helping investors across the nation. If you, or someone you know, have lost money investing Eric Korhut, please contact Oakes & Fosher for a free and private consultation. We work on a contingency basis, which means there are no fees charged unless we collect for you.