Broker Luke Johnson’s Client Complaints – Compensation Help

Former Coastal Broker Luke Michael Johnson’s List of Customer Disputes Runs Long

Now a registered investment advisor with Prime Capital Investment Advisors, LLC,  Luke Michael Johnson was once registered as a broker with several securities firms, according to records gathered by the Financial Industry Regulatory Authority (FINRA)’s BrokerCheck.

In this capacity, 20 customer disputes (14 pending and six final) have been filed against Johnson, BrokerCheck reports. He also experienced three terminations.  

Settled Consumer Disputes

While Johnson worked for Coastal Equities, Inc./Coastal Investments Advisors, Inc., a client accused the broker of recommending unsuitable investments and of breach of fiduciary duty, according to BrokerCheck. The client alleged that their damages amounted to $363,568. The complaint was received on December 23, 2019 and was settled on April 7, 2020 in the amount of $22,000.

Earlier that same year, FINRA Office of Dispute Resolution handled the arbitration of another client complaint against Johnson, BrokerCheck reports. In this instance, the client accused Johnson of negligent management of their portfolio and of unsuitable sales—an allegation that Johnson denied. Rather, the broker insisted that the investors had represented themselves as sophisticated and accredited investors and that the investments he recommended suited this stature. The client alleged damages totalling $797,865.50. The matter was settled in November 2020 in the amount of $390,000.

BrokerCheck further reports that in June of 2019, claimants stepped forward to accuse Coastal Equities, Inc./Coastal Investments Advisors of mispresenting and omitting facts while soliciting the sale of specific private placement investments. The claimants also stated that Johnson’s employer was negligent when it failed to reject the product that was for sale during the due diligence process. Johnson was not specifically named in this complaint. The clients claimed damages in the amount of $750,000, and they received a settlement in the amount of $150,000. Johnson denied the claimant’s accusations and asserted that the client did not suffer a loss.

Going further back in Johnson’s career, but at a time when he still worked for Coastal Equities, Inc., a client’s attorney filed a complaint alleging that Johnson had made unsuitable alternative investment recommendations. The lawyer also stated that within his client’s advisory portfolio, three securities represented unsuitable investments. Johnson denied the investments’ unsuitability, claiming that his client never expressed a need for liquidity. The lawyer for Johnson’s client did not allege damages, but in December 2018, the matter entered FINRA arbitration. In August of 2019, the matter settled for $225,000, including an individual contribution amount of $70,000.

In a fifth customer dispute, BrokerCheck reports that process was served on Johnson on June 28, 2018 after a customer accused the Johnson of recommending unsuitable securities investments in 2015. Johnson argued that the claim was without merit and that the investment recommendation made sense given the client’s investment objectives, financial status, and risk tolerance. The matter was ultimately settled as a business decision, in the amount of $140,000, with an individual contribution f $70,000.

Other Unhappy Clients Still Await the Outcomes of Their Complaints

A sixth customer dispute, filed in 2017, was closed, according to BrokerCheck.  This leaves 14 additional, pending customer disputes against Johnson. The alleged damages in these cases range from $76,000 to over two million dollars.

 
 
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