The industry's regulator claims that a former financial advisor didn't make recommendations that were in the best interests of her clients.
A former Edward Jones financial advisor has agreed to settle charges brought by the Financial Industry Regulatory Authority accusing her of violating the Securities and Exchange Commission's Regulation Best Interest in relation to her recommendations of certain mutual funds.
Mary Beslagic had been with Edward Jones since first registering as a broker in 2011, according to her BrokerCheck profile. The company discharged her in August last year amid "concerns including recommending two clients access home equity line proceeds to purchase investments," according to her record.
Finra claims that Beslagic recommended in March 2022 that a married couple invest the proceeds from their liquified home equity loans -- which amounted to $220,000 -- in mutual funds, which allegedly added the risk of short-term capital loss and therefore wasn't in their best interest, according to a letter of acceptance, waiver and consent published by the industry's self-regulator.
Finra claims that the mutual funds started dropping in value shortly after the purchase, eventually forcing the couple to unload a portion of their investment in the funds at a loss and take out margin loans to the tune of $25,000 to cover their near-term liquidity obligations.
Earlier this month, Beslagic agreed to a two-month suspension and to pay a fine of $5,000 without admitting or denying the findings, Finra said in the letter of acceptance.
Since her discharge from Edward Jones last year, Beslagic has not registered with another firm, according to BrokerCheck and the SEC's Investment Adviser Public Disclosure database.
In addition to her discharge from Edward Jones, Beslagic is also facing a customer dispute alleging that a "recommendation to invest home equity line of credit proceeds in mutual funds was inappropriate resulting or contributing to account losses, the decision to surrender a long term care policy, and use of margin," according to her record.