Ladenburg Executive Erinn Ford Cleans Part of Her Record
Erinn Ford, a 26-year veteran of independent broker-dealer firms, has won four arbitration decisions since May that allow her to seek expungement of customer complaints accumulated when she was an executive of now-defunct Pacific West Securities.
In arbitration panel in July, however, ruled that three complaints must stay on her record.
Ford, who in April became chief executive of Seattle-based KMS Financial Services, has 15 sales suitability complaints filed between April 2011 and July 2016 on her BrokerCheck record.
All have been settled, for a total of $1.2 million, and in each case Ford had no contact with the complaining client and was named only because of her position as Pacific West vice president, according to her comments on BrokerCheck.
The executive’s methodical effort to clean her complaint history has had mixed success.
Arbitrator Donald Tolin in Denver last week recommended expungement of a complaint from a customer who testified that she did not hold Ford responsible for “‘anything that took place with my case,’” according to the award document.
But a three-person arbitration panel in Seattle in early July denied her claim to expunge three customer complaints after determining that she had a 22.5% equity interest in Pac West. “Because of this added responsibility, it follows that her involvement with clients would be greater,” the arbitrators wrote.
Ford’s family owned Pac West, and she made the decision to shutter it because of “compressed margins and a challenging regulatory environment,” according to a 2015 article she wrote in “Investment News.”
Ford did not respond to requests for comment on her efforts, or on whether she will seek to vacate any decisions against her.
Her campaign comes as Finra is under pressure to refine its arbitration rules to make it more difficult for registered representatives to delete complaints that it says can help investors make informed choices about brokers and brokerage firms.
John Owen Murrin, a plaintiff’s lawyer in California who represented several clients who settled with Pac West and Ford over sales of tenant-in-common investments, said he was alarmed by her expungement successes.
“They changed people’s lives with the amount of money that was lost,” he said. “It is disturbing that the system would allow something like this to happen.”
A lawyer at the Portland, Ore. firm of Markun Zusman Freniere & Compton, which has represented Ford in each expungement claim, did not return a request for comment.
Finra, an industry-financed regulator, proposed new rules in December 2017 making expungement more difficult to achieve, but has not yet forwarded them for approval to the Securities and Exchange Commission. A coterie of defense lawyers has urged brokers with records to seek expungement before tougher rules take effect.
Prior to joining KMS, which is owned by Ladenburg Thallman, Ford was president of Cetera Advisors, a Cetera Financial Group unit that hired many of PacWest’s brokers.
It could not be determined whether the 15 claims on Ford’s regulatory records—some of which involve sale of oil and gas investments—include those in the process of being expunged. Under Finra rules, brokers must obtain confirmation from a court before regulators execute expungement directives.
—Jed Horowitz contributed to this article.