An investor has received the first arbitration award against a broker-dealer over the sale of a private placement investment.
When Peak Securities did not show up to defend the claim arising from the purchase of notes offered by Medical Provider Funding Corp., the investor won a $400,000 FINRA arbitration award.
Those notes are at the center of a Securities and Exchange Commission fraud complaint issued last summer. The SEC charged Medical Capital Holdings Inc. with fraud in the sale of $77 million in notes. Many independent broker-dealers sold the notes.
Several class actions have been filed against various broker-dealers that sold Medical Capital notes. In addition, investors have filed hundreds of arbitration claims against individual broker-dealers who sold those notes.
Peak Securities has lost its FINRA registration to serve as a broker-dealer.