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Business Observer Friday, Jun. 25, 2021 5 months ago

Financial advisors awarded $1.5 million after receiving negligent compliance advice

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An investigation and bad press cost the advisors potential customer accounts

SARASOTA — Circuit Court Judge Judge Hunter Carroll recently awarded nearly $1.5 million to four south Sarasota County financial advisors following a three-week trial. 

The court found that Scott Aabel, Antonio Gomes, Gary Didonna and James Protigal, of Nokomis in Sarasota County, were given negligent compliance advice, which led to a regulatory investigation and subsequent bad press. The four financial advisors were represented by securities attorneys Drew Clayton and Worth Graham of Icard, Merrill, Cullis, Timm, Furen & Ginsburg. 

According to a press release, the investigation and bad press cost the four financial advisors tens of millions of dollars in lost customer accounts and the revenues that those accounts would have generated. “We finally feel vindicated,” Aabel says in the release. “For years, the negative news stories from 2012 have alarmed our clients and scared off prospective clients.” 

The financial advisors, their brokerage firm, Prime Capital Services, and its related investment advisory firm, Asset & Financial Planning Inc. (AFP) were alleged to be in violation of Florida securities laws by the manner management fees were charged for actively managed variable annuities. The Florida Office of Financial Regulation commenced the regulatory action in 2012. 

However, Judge Carroll, in the Twelfth Judicial Circuit, laid the blame on the brokerage firm in his 62-page ruling, the release states. The court also found the defendants liable for more than $400,000 due to their unlawful withholding of the advisors’ revenues as the regulatory action was being settled with the state of Florida.

“Now that a judge has listened to the entire story and seen the evidence, we hope that this will undo some of the damage we have suffered for more than eight years,” Gomes says in the release. 

The advisors expect to receive prejudgment interest which may increase the total award to more than $2 million. They will also seek to recover a substantial portion of their costs, the release states. 

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