History Of Kurt Jason Gunter
Gunter first became registered with FINRA in 1996. Gunter was registered as a General
Securities Representative and Investment Company and Variable Contracts Products
Representative through an association with Stifel, Nicolaus & Company, Inc. (CRD No.
793) from June 2013 until August 2017, when he voluntarily resigned from firm. Gunter
is currently associated as a General Securities Representative through an association with
another FINRA member firm.
Respondent does not have any relevant disciplinary history.
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A. Unit Investment Trusts
A Unit Investment Trust alIT) is a SEC-registered investment company that offers
investors sa 1 ares or “units” in a fixed portfolio of securities Via a oneninde public .offering,
A LITT terminates on a specified maturity date, often after 15 or 24 months, at which
point thc underlying securities are sold and the resulting proceeds are paid to the
investors. A UIT’s portfolio is not actively managed between the trust’s inception and its
MT sponsors often offer UIT product lines in successive “series,” with he offering,
periods for new series typically coinciding with the maturity date of prior series,
Successive series of ILJITs often have the same or similar investment, objectives arid
investment strategies as the prior series, even if the portfolio of securities held by the Uhf
changes from series to series.
LF1Ts impose a variety of upfront sales charges. For example, during the relevant period,
a typical 24 -month U]T contained three separate charges: (1) an initial sales charge,
which was generally 1% of the purchase price; (2) a deferred sales charge, which was
generally up to 2.5% of the offering price; and (3) a creation and development fee (C&D
fee), which was generally 0.5% of the offering price.’ If the proceeds from the sale of a
Uri were “rolled over” to fund the purchase of a new Uh UIT sponsors often waived
the initial sales charge hut still applied1 the deferred sales charge and C&D fee.
A registered representative who recommended the sale of a customer’s LIT before its
maturity date and used the sale proceeds to purchase a new ‘ITT would cause the
customer to incur greater sales charges than if the customer had held the 7777 until
maturity. For example, a hypothetical customer who purchased a24-month UIT and held
it until maturity would have paid a sales charge of about 3.95%. However, if after six
months, the customer rolled over the LIT into a new Ul 1, he or she would have paid an
additional 2.95% m sales charges. And, if the customer repeatedly roiled OViCif the existing
into a new LIT every six months, he or she would have paid total sales charges ®f
approximately 12,8% over a two-year period.
Because of the 1ong-term nature of fans, their structure, and their costs, short-term
trading of tiffs may be improper.
B. Gunter Engaged in a Unsuitable Pattern of Early Rollovers of UITs
From July 2013 through December 2016, Chanter recorrutnortissi Loa I 1his [maim-nays roil
over LIT Ts more than 100 days prior to maturity on more than 2716 occasions.
Indeed, although his customers’ UITs typically had a 24-month maturity period, Gunter
recommended that they sell their LTITs after holding them for, on average, only 297 days,
and use the proceeds to purchase a new UIT.
Of the more than 270 early rollovers recommended by Gunter, more than 120 were
“series-to-series” rollovers. In other words, on more than 120 occasions, Gunter
recommended that his customers roll over a UIT before its maturity date to purchase a
subsequent series of the same UIT, which, as noted above, generally had the same or
similar investment objectives and strategies as the prior series.
As one example of a recommended “series-to-series” rollover, Gunter recommended in
October 2013 that a customer purchase a UIT issued in the third quarter of 2013 that had
an investment strategy of seeking “above-average capital appreciation” and held a
portfolio of “well capitalized” stocks in companies with “strong market positions” (the
CS 22 Series). Although the CS 22 Series had a 24-month maturity period, Gunter
recommended that his customer sell it after only 76 days and use the proceeds to
purchase a later series of the same UIT issued in the fourth quarter of 2013 (the CS 23
Series). The CS 23 Series had the identical investment strategy and objectives of the CS
22 Series and held similar stocks. Gunter’s recommendation that his customer sell the CS
22 Series approximately 22 months prior to its maturity and use the proceeds to purchase
the CS 23 Series caused his customer to incur increased sales charges to purchase what
was, essentially, the same investment.
Gunter’s recommendations caused his customers to incur unnecessary sales charges,2and
were unsuitable in view of the frequency and cost of the transactions.
Therefore, Gunter violated FINRA Rules 2111 and 2010.
C. Gunter Signed Switch Letters That Were Setn to Customers Containing Inaccurate Information about the Costs They Incurred as a Result of Early UIT Rollovers
FINRA Rule 2010 requires a member firm and its associated persons to “observe high
standards of commercial honor and just and equitable principles of trade.” A negligent
misstatement or omission of material fact to a customer violates FINRA Rule 2010.
From July 2013 through December 2016, Gunter signed 127 switch letters in connection
with early UIT rollovers. The switch letters were intended to provide customers with
necessary information about the switch transaction, including its costs. Customers were
required to sign and return the letters to Stifel acknowledging the switch transaction.
Although Gunter verbally notified customers of the costs of Tiffs, 96 of the UIT switch
letters that Gunter signed and that were sent to customers during this period either
contained inaccurate information about the costs customers incurred in connection with
their early UIT rollovers or failed to specify the costs. Specifically,75 of the UIT switch
letters understated the sales charges associated with the switch by at least 25%, and 21 of
the letters did not list any sales charge associated with the new UIT purchased by the
customer, even though the switches had resulted in customers incurring new sales
charges. On average, the switch letters that contained inaccurate information understated
the sales charges that the customers incurred by approximately $2,500.
Therefore, Gunter violated FINRA Rule 2010.
Penalties, Punishments & Sanctions
A three-month suspension from associating with any FINRA member in any
capacity; and a $10,000 fine.
Respondent agrees to pay the monetary sanction upon notice that this AWC has been
accepted and that such payment is due and payable. Respondent has submitted an
Election of Payment form showing the method by which he proposes to pay the fine
Respondent specifically and voluntarily waives any right to claim an inability to pay, now
or at any time after the execution of this AWC, the monetary sanction imposed in this
Respondent understands that if he is barred or suspended from associating with any
FINRA member, he becomes subject to a statutory disqualification as that term is defined
in Article III, Section 4 of FINRA’s By-Laws, incorporating Section 3(a)(39) of the
Securities Exchange Act of 1934. Accordingly, he may not be associated with any
FINRA member in any capacity, including clerical or ministerial functions, during the
period of the bar or suspension. See FINRA Rules 8310 and 8311.
The sanctions imposed in this AWC shall be effective on a date set by FINRA.
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From July 2013 through December 2016, Gunter engaged in an unsuitable pattern of
short-term trading of Unit Investment Trusts in customer accounts. Based on the
foregoing, Gunter violated FINRA Rules 2111 and 2010.
In addition, during the same period, Gunter signed switch letters that were sent to
customers that contained inaccurate or missing information about the costs that they
incurred as a result of early rollovers of Unit Investment Trusts, in violation of FINRA
How To Spot A Fraud Finance Advisor (Infographic)
Help For Victims Of Kurt Jason Gunter
If you have lost funds because of misrepresentation, unsuitable investment, or unsuitable investment strategy from Kurt Jason Gunter. Then you can take legal action and get justice. Fraud, Malpractice & dereliction of duty should not be taken lightly, especially in this industry. We highly suggest that you notify authorities or seek legal action if your financial advisor or brokerage firm fails to abide by FINRA’s rules are regulations.
Financial advisors are regulatory & legally obligated to suggest (recommend) the most suitable investments/investment strategies to their clients. Their suggestions should have their client’s best interests and should be appropriate for their client’s goals and needs. Similarly, the brokerage firm which hires financial advisors also has a regulatory & legal obligation to keep a close watch and supervise their Financial Advisors’ practices & behavior. They need to make sure that the financial advisor is not being manipulative or having an unreasonable bias towards certain investments. If the financial advisor and/or the brokerage firm breaches these duties, then the client/customer may be entitled to a full or partial recovery of their losses.
Financial advisors need to have the interest of their clients when giving suggestions related to investments and investment strategies. Reasonable basis suitability requires the advisor to do their best to analyze & identify the risks and rewards associated with their suggested investment and/or investment strategy.
Kurt Jason Gunter has been involved in fraudulent activities and is an unsafe professional entity. We strongly recommend you avoid any association with such a shady figure.
- Shady Activity
- Swindling Activity Reported By Clients
- Under Govt. Organization's Radar
- High Risk of Fraud