jeffrey timothy kluge

BrokerCheck Report

JEFFREY TIMOTHY KLUGE

Section Title

Report Summary

Broker Qualifications

Registration and Employment History

Disclosure Events

CRD# 2187964

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JEFFREY T. KLUGE

CRD# 2187964

This broker is not currently registered.

Report Summary for this Broker

This report summary provides an overview of the broker's professional background and conduct. Additionalinformation can be found in the detailed report.

Disclosure Events

All individuals registered to sell securities or provideinvestment advice are required to disclose customercomplaints and arbitrations, regulatory actions,employment terminations, bankruptcy filings, andcriminal or civil judicial proceedings.

Are there events disclosed about this broker? Yes

The following types of disclosures have beenreported:

Type Count

Regulatory Event 2

Criminal 1

Customer Dispute 7

Investment Adviser RepresentativeInformation

https://www.adviserinfo.sec.gov

The information below represents the individual'srecord as a broker. For details on this individual'srecord as an investment adviser representative,visit the SEC's Investment Adviser PublicDisclosure website at



This broker has passed:

0 Principal/Supervisory Exams

3 General Industry/Product Exams

2 State Securities Law Exams

Registration History

This broker was previously registered with thefollowing securities firm(s):

MERRILL LYNCH, PIERCE, FENNER &SMITH INCORPORATEDCRD# 7691SAINT PAUL, MN11/1991 - 12/2016

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www.finra.org/brokercheck User Guidance

1�2021 FINRA. All rights reserved. Report about JEFFREY T. KLUGE.


https://adviserinfo.sec.gov/individual/summary/2187964

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Registrations

This section provides the self-regulatory organizations (SROs) and U.S. states/territories the broker is currently registered and licensed with, thecategory of each license, and the date on which it became effective. This section also provides, for every brokerage firm with which the broker iscurrently employed, the address of each branch where the broker works.








Industry Exams this Broker has Passed

This individual has passed 0 principal/supervisory exams, 3 general industry/product exams, and 2 state securities law exams.

This section includes all securities industry exams that the broker has passed. Under limited circumstances, a broker may attain a registrationafter receiving an exam waiver based on exams the broker has passed and/or qualifying work experience. Any exam waivers that the broker hasreceived are not included below.

Exam Category Date

Principal/Supervisory Exams

No information reported.

Exam Category Date

General Industry/Product Exams

Securities Industry Essentials Examination 12/08/2016SIEB

Futures Managed Funds Examination 01/30/1997Series 31B

General Securities Representative Examination 11/12/1991Series 7B

Exam Category Date

State Securities Law Exams

Uniform Investment Adviser Law Examination 06/29/1994Series 65IA

Uniform Securities Agent State Law Examination 12/24/1991Series 63B

Additional information about the above exams or other exams FINRA administers to brokers and other securities professionals can be found atwww.finra.org/brokerqualifications/registeredrep/.





www.finra.org/brokerqualifications/registeredrep/



Professional Designations

This section details that the representative has reported 0 professional designation(s).

No information reported.







Registration History

Registration Dates Firm Name CRD# Branch Location

The broker previously was registered with the following firms:

B 11/1991 - 12/2016 MERRILL LYNCH, PIERCE, FENNER &SMITH INCORPORATED

7691 SAINT PAUL, MN

Employment History

Employment Employer Name Investment RelatedPosition Employer Location

This section provides up to 10 years of an individual broker's employment history as reported by the individual broker on the most recently filedForm U4.

Please note that the broker is required to provide this information only while registered with FINRA or a national securities exchangeand the information is not updated via Form U4 after the broker ceases to be registered. Therefore, an employment end date of"Present" may not reflect the broker's current employment status.

12/2009 - Present BANK OF AMERICA, N.A. SVP; WEALTHMANAGEMENTADVISOR

Y ST PAUL, MN, United States

09/1991 - Present MERRILL LYNCH, PIERCE, FENNER &SMITH INCORPORATED

SVP; WEALTHMANAGEMENTADVISOR

Y ST. PAUL, MN, United States

Other Business Activities

This section includes information, if any, as provided by the broker regarding other business activities the broker is currently engaged in either asa proprietor, partner, officer, director, employee, trustee, agent or otherwise. This section does not include non-investment related activity that isexclusively charitable, civic, religious or fraternal and is recognized as tax exempt.

I*45358FOR PROFIT OR NOT FOR PROFIT: FOR-PROFIT ORGANIZATIONNAME OF OUTSIDE BUSINESS ORGANIZATION: KLUGE CAPITAL MANAGEMENTINVESTMENT RELATED: YADDRESS OF BUSINESS: LAKE ELMO, MINNESOTANATURE OF BUSINESS: LIMITED PARTNERSHIP,POSITION, TITLE, ASSOCIATION: FAMILY HELD,START DATE OF RELATIONSHIP: 9/22/2011NUMBER OF HOURS DEVOTED: 8 HOUR(S) MONTHLYNUMBER OF HOURS DEVOTED DURING TRADING HOURS: 2DUTIES: FAMILY LIMITED PARTNERSHIP

(2)FOR PROFIT OR NOT FOR PROFIT: NON-PROFIT ORGANIZATION- NAME OF OUTSIDE BUSINESS ORGANIZATION: IMCA- INVESTMENT RELATED: N- ADDRESS OF BUSINESS:GREENWOOD VILLAGE, CO 80111- NATURE OF BUSINESS: OTHER- POSITION, TITLE, ASSOCIATION: OTHER- START DATE OF RELATIONSHIP: 02/04/2013- NUMBER OF HOURS DEVOTED: 5 MONTHLY- NUMBER OF HOURS DEVOTED DURING TRADING HOURS: 5 MONTHLY- DUTIES: INVESTMENT MANAGEMENT CONSULTANTS ASSOCIATION WAS ESTABLISHED IN 1985 TO DELIVER THE PREMIERINVESTMENT CONSULTING AND WEALTH MANAGEMENT CREDENTIALS AND WORLD-CLASS EDUCATIONAL OFFERINGS THROUGHMEMBERSHIP, CONFERENCES, RESEARCH, AND PUBLICATIONS.







Other Business Activities, continued

I*45358FOR PROFIT OR NOT FOR PROFIT: FOR-PROFIT ORGANIZATIONNAME OF OUTSIDE BUSINESS ORGANIZATION: KLUGE CAPITAL MANAGEMENTINVESTMENT RELATED: YADDRESS OF BUSINESS: LAKE ELMO, MINNESOTANATURE OF BUSINESS: LIMITED PARTNERSHIP,POSITION, TITLE, ASSOCIATION: FAMILY HELD,START DATE OF RELATIONSHIP: 9/22/2011NUMBER OF HOURS DEVOTED: 8 HOUR(S) MONTHLYNUMBER OF HOURS DEVOTED DURING TRADING HOURS: 2DUTIES: FAMILY LIMITED PARTNERSHIP

(2)FOR PROFIT OR NOT FOR PROFIT: NON-PROFIT ORGANIZATION- NAME OF OUTSIDE BUSINESS ORGANIZATION: IMCA- INVESTMENT RELATED: N- ADDRESS OF BUSINESS:GREENWOOD VILLAGE, CO 80111- NATURE OF BUSINESS: OTHER- POSITION, TITLE, ASSOCIATION: OTHER- START DATE OF RELATIONSHIP: 02/04/2013- NUMBER OF HOURS DEVOTED: 5 MONTHLY- NUMBER OF HOURS DEVOTED DURING TRADING HOURS: 5 MONTHLY- DUTIES: INVESTMENT MANAGEMENT CONSULTANTS ASSOCIATION WAS ESTABLISHED IN 1985 TO DELIVER THE PREMIERINVESTMENT CONSULTING AND WEALTH MANAGEMENT CREDENTIALS AND WORLD-CLASS EDUCATIONAL OFFERINGS THROUGHMEMBERSHIP, CONFERENCES, RESEARCH, AND PUBLICATIONS.






Disclosure Events

What you should know about reported disclosure events:

1. All individuals registered to sell securities or provide investment advice are required to disclose customer complaints and arbitrations,regulatory actions, employment terminations, bankruptcy filings, and criminal or civil judicial proceedings.

2. Certain thresholds must be met before an event is reported to CRD, for example: o A law enforcement agency must file formal charges before a broker is required to disclose a particular criminal event. o A customer dispute must involve allegations that a broker engaged in activity that violates certain rules or conduct governing the

industry and that the activity resulted in damages of at least $5,000. o

3. Disclosure events in BrokerCheck reports come from different sources: o As mentioned at the beginning of this report, information contained in BrokerCheck comes from brokers, brokerage firms and

regulators. When more than one of these sources reports information for the same disclosure event, all versions of the event willappear in the BrokerCheck report. The different versions will be separated by a solid line with the reporting source labeled.

o4. There are different statuses and dispositions for disclosure events:

o A disclosure event may have a status of pending, on appeal, or final.§ A "pending" event involves allegations that have not been proven or formally adjudicated.§ An event that is "on appeal" involves allegations that have been adjudicated but are currently being appealed.§ A "final" event has been concluded and its resolution is not subject to change.

o A final event generally has a disposition of adjudicated, settled or otherwise resolved.§ An "adjudicated" matter includes a disposition by (1) a court of law in a criminal or civil matter, or (2) an administrative

panel in an action brought by a regulator that is contested by the party charged with some alleged wrongdoing.§ A "settled" matter generally involves an agreement by the parties to resolve the matter. Please note that brokers and

brokerage firms may choose to settle customer disputes or regulatory matters for business or other reasons.§ A "resolved" matter usually involves no payment to the customer and no finding of wrongdoing on the part of the

individual broker. Such matters generally involve customer disputes.

For your convenience, below is a matrix of the number and status of disclosure events involving this broker. Further informationregarding these events can be found in the subsequent pages of this report. You also may wish to contact the broker to obtain furtherinformation regarding these events.

Final On AppealPending

Regulatory Event 0 2 0

Criminal 0 1 0

Customer Dispute 0 7 N/A






Disclosure Event Details

When evaluating this information, please keep in mind that a discloure event may be pending or involve allegations that are contested and havenot been resolved or proven. The matter may, in the end, be withdrawn, dismissed, resolved in favor of the broker, or concluded through anegotiated settlement for certain business reasons (e.g., to maintain customer relationships or to limit the litigation costs associated with disputingthe allegations) with no admission or finding of wrongdoing.

This report provides the information exactly as it was reported to CRD and therefore some of the specific data fields contained in the report maybe blank if the information was not provided to CRD.

Regulatory - Final

This type of disclosure event may involve (1) a final, formal proceeding initiated by a regulatory authority (e.g., a state securities agency, self-regulatory organization, federal regulatory such as the Securities and Exchange Commission, foreign financial regulatory body) for a violation ofinvestment-related rules or regulations; or (2) a revocation or suspension of a broker's authority to act as an attorney, accountant, or federalcontractor.

Disclosure 1 of 2

Reporting Source: Regulator

Regulatory Action InitiatedBy:

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Sanction(s) Sought: Other: n/a

Date Initiated: 09/28/2017

Docket/Case Number: 3-18237

Employing firm when activityoccurred which led to theregulatory action:

Merrill Lynch, Pierce, Fenner & Smith, Inc.

Product Type: No Product

Allegations: SEC Admin Release 34-81758, IA Release 40-4782 / September 28, 2017:The Securities and Exchange Commission ("Commission") deems it appropriateand in the public interest that public administrative proceedings be, and herebyare, instituted pursuant to Section 15(b) of the Securities Exchange Act of 1934("Exchange Act") and Section 203(f) of the Investment Advisers Act of 1940("Advisers Act") against Jeffrey Timothy Kluge ("Respondent").The Commission finds that on March 29, 2017, Kluge pleaded guilty to two countsof bank fraud in violation of Title 18 United States Code, Section 1344 before theUnited States District Court for the District of Minnesota, in United States v. JeffreyTimothy Kluge, Crim. Information No. 17-CR-61. On 8-11-2017, a judgment in thecriminal case was entered against Kluge. He was sentenced to a prison term of 50months followed by 3 years of supervised release and ordered to make restitutionin the amount of $8,680,489.50.In his written plea agreement, Kluge admitted (and where he lacked directknowledge, acknowledged that the government has sufficient evidence to provebeyond a reasonable doubt) that:In 2001, Kluge obtained a line of credit for $150,000 from Alliance Bank. Inconnection with his application for that line of credit, Kluge falsely represented toAlliance Bank that he held shares in municipal bond funds sufficient to serve ascollateral for the line of credit. Kluge provided a falsified account statement tosubstantiate his purported municipal bond fund holdings and he pledged thepurported holdings as collateral for the line of credit.Between 2001 and November of 2016, Kluge obtained periodic increases to hisline of credit with Alliance Bank such that he had an outstanding balance on theline of more than $5.989 million in November 2016. With each renewal andincrease to the line of credit, Kluge made misrepresentations to Alliance Bank withrespect to property he pledged as collateral. Specifically, Kluge represented toAlliance Bank that he held assets in brokerage accounts at Merrill Lynch and hefurther represented that those assets could be pledged as collateral for his line ofcredit with Alliance Bank.In reality, Kluge had already pledged the assets in the brokerage accounts ascollateral for loans he had obtained from Merrill Lynch and Merrill Lynch held asecurity interest in the assets in the brokerage accounts. Kluge concealed thisinformation from Alliance Bank. In addition, Kluge provided falsified brokerageaccount statements to Alliance Bank, which made it appear that the assets in thebrokerage accounts were pledged to Alliance Bank.In or about May 2007, Kluge obtained a line of credit for $1 million from PlatinumBank. In connection with his application for that line of credit, Kluge falselyrepresented to Platinum Bank that he held assets in a Merrill Lynch brokerageaccount and further falsely represented that these assets could be pledged ascollateral for the line of credit with Platinum Bank.In reality, the assets in the brokerage account had already been pledged ascollateral for loans Kluge had obtained from Merrill Lynch, a fact which Klugeconcealed from Platinum Bank. In addition, Kluge had already pledged the sameassets as collateral for the line of credit he obtained from Alliance bank describedabove.Between 2007 and November of 2016, Kluge obtained periodic increases in hisline of credit with Platinum Bank such that he had an outstanding balance on theline of credit of more than $2.684 million in November 2016. With each renewaland increase in the line of credit, Kluge made misrepresentations to Platinum Bankwith respect to the assets in the brokerage account that he had pledged ascollateral.






SEC Admin Release 34-81758, IA Release 40-4782 / September 28, 2017:The Securities and Exchange Commission ("Commission") deems it appropriateand in the public interest that public administrative proceedings be, and herebyare, instituted pursuant to Section 15(b) of the Securities Exchange Act of 1934("Exchange Act") and Section 203(f) of the Investment Advisers Act of 1940("Advisers Act") against Jeffrey Timothy Kluge ("Respondent").The Commission finds that on March 29, 2017, Kluge pleaded guilty to two countsof bank fraud in violation of Title 18 United States Code, Section 1344 before theUnited States District Court for the District of Minnesota, in United States v. JeffreyTimothy Kluge, Crim. Information No. 17-CR-61. On 8-11-2017, a judgment in thecriminal case was entered against Kluge. He was sentenced to a prison term of 50months followed by 3 years of supervised release and ordered to make restitutionin the amount of $8,680,489.50.In his written plea agreement, Kluge admitted (and where he lacked directknowledge, acknowledged that the government has sufficient evidence to provebeyond a reasonable doubt) that:In 2001, Kluge obtained a line of credit for $150,000 from Alliance Bank. Inconnection with his application for that line of credit, Kluge falsely represented toAlliance Bank that he held shares in municipal bond funds sufficient to serve ascollateral for the line of credit. Kluge provided a falsified account statement tosubstantiate his purported municipal bond fund holdings and he pledged thepurported holdings as collateral for the line of credit.Between 2001 and November of 2016, Kluge obtained periodic increases to hisline of credit with Alliance Bank such that he had an outstanding balance on theline of more than $5.989 million in November 2016. With each renewal andincrease to the line of credit, Kluge made misrepresentations to Alliance Bank withrespect to property he pledged as collateral. Specifically, Kluge represented toAlliance Bank that he held assets in brokerage accounts at Merrill Lynch and hefurther represented that those assets could be pledged as collateral for his line ofcredit with Alliance Bank.In reality, Kluge had already pledged the assets in the brokerage accounts ascollateral for loans he had obtained from Merrill Lynch and Merrill Lynch held asecurity interest in the assets in the brokerage accounts. Kluge concealed thisinformation from Alliance Bank. In addition, Kluge provided falsified brokerageaccount statements to Alliance Bank, which made it appear that the assets in thebrokerage accounts were pledged to Alliance Bank.In or about May 2007, Kluge obtained a line of credit for $1 million from PlatinumBank. In connection with his application for that line of credit, Kluge falselyrepresented to Platinum Bank that he held assets in a Merrill Lynch brokerageaccount and further falsely represented that these assets could be pledged ascollateral for the line of credit with Platinum Bank.In reality, the assets in the brokerage account had already been pledged ascollateral for loans Kluge had obtained from Merrill Lynch, a fact which Klugeconcealed from Platinum Bank. In addition, Kluge had already pledged the sameassets as collateral for the line of credit he obtained from Alliance bank describedabove.Between 2007 and November of 2016, Kluge obtained periodic increases in hisline of credit with Platinum Bank such that he had an outstanding balance on theline of credit of more than $2.684 million in November 2016. With each renewaland increase in the line of credit, Kluge made misrepresentations to Platinum Bankwith respect to the assets in the brokerage account that he had pledged ascollateral.

Current Status: Final

Resolution: Order

Does the order constitute afinal order based onviolations of any laws orregulations that prohibitfraudulent, manipulative, ordeceptive conduct?






Resolution Date: 09/28/2017

Sanctions Ordered:


No

Bar (Permanent)

If the regulator is the SEC,CFTC, or an SRO, did theaction result in a finding of awillful violation or failure tosupervise?

No

(1) willfully violated anyprovision of the SecuritiesAct of 1933, the SecuritiesExchange Act of 1934, theInvestment Advisers Act of1940, the InvestmentCompany Act of 1940, theCommodity Exchange Act, orany rule or regulation underany of such Acts, or any ofthe rules of the MunicipalSecurities Rulemaking Board,or to have been unable tocomply with any provision ofsuch Act, rule or regulation?

(2) willfully aided, abetted,counseled, commanded,induced, or procured theviolation by any person ofany provision of theSecurities Act of 1933, theSecurities Exchange Act of1934, the InvestmentAdvisers Act of 1940, theInvestment Company Act of1940, the CommodityExchange Act, or any rule orregulation under any of suchActs, or any of the rules ofthe Municipal SecuritiesRulemaking Board? or







(3) failed reasonably tosupervise another personsubject to your supervision,with a view to preventing theviolation by such person ofany provision of theSecurities Act of 1933, theSecurities Exchange Act of1934, the InvestmentAdvisers Act of 1940, theInvestment Company Act of1940, the CommodityExchange Act, or any rule orregulation under any suchActs, or any of the rules ofthe Municipal SecuritiesRulemaking Board?

Capacities Affected: participating in any offering of a penny stock

Duration: Indefinite

Start Date: 09/28/2017

End Date:

Sanction 1 of 2

Sanction Type: Bar (Permanent)

Sanction 2 of 2






Regulator Statement Respondent has submitted an Offer of Settlement (the "Offer") which theCommission has determined to accept.It is ORDERED Kluge is barred from association with any broker, dealer,investment adviser, municipal securities dealer, municipal advisor, transfer agent,or nationally recognized statistical rating organization; and barred fromparticipating in any offering of a penny stock, including: acting as a promoter,finder, consultant, agent or other person who engages in activities with a broker,dealer or issuer for purposes of the issuance or trading in any penny stock, orinducing or attempting to induce the purchase or sale of any penny stock.

Capacities Affected: association with a broker, dealer, investment adviser, municipal securities dealer,municipal advisor, transfer agent, or NRSRO



End Date:


Disclosure 2 of 2

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Regulatory Action InitiatedBy:

FINRA

Sanction(s) Sought: Suspension

Date Initiated: 03/17/2017

Docket/Case Number: 2016052377201

Employing firm when activityoccurred which led to theregulatory action:

N/A

Product Type: No Product

Allegations: Respondent Kluge failed to respond to FINRA request for information.


Resolution: Letter







Resolution Date: 06/20/2017

Sanctions Ordered:


No

Bar (Permanent)

If the regulator is the SEC,CFTC, or an SRO, did theaction result in a finding of awillful violation or failure tosupervise?

No

(1) willfully violated anyprovision of the SecuritiesAct of 1933, the SecuritiesExchange Act of 1934, theInvestment Advisers Act of1940, the InvestmentCompany Act of 1940, theCommodity Exchange Act, orany rule or regulation underany of such Acts, or any ofthe rules of the MunicipalSecurities Rulemaking Board,or to have been unable tocomply with any provision ofsuch Act, rule or regulation?








(3) failed reasonably tosupervise another personsubject to your supervision,with a view to preventing theviolation by such person ofany provision of theSecurities Act of 1933, theSecurities Exchange Act of1934, the InvestmentAdvisers Act of 1940, theInvestment Company Act of1940, the CommodityExchange Act, or any rule orregulation under any suchActs, or any of the rules ofthe Municipal SecuritiesRulemaking Board?

Capacities Affected: All Capacities



End Date:

Sanction 1 of 2


Sanction 2 of 2






Regulator Statement Pursuant to FINRA Rule 9552(h) and in accordance with FINRA's Notice ofSuspension and Suspension from Association letters dated March 17, 2017, andApril 10, 2017, respectively, on June 20, 2017, Kluge is barred from associationwith any FINRA member in any capacity. Respondent failed to request terminationof his suspension within three months of the date of the Notice of Suspension;therefore, he is automatically barred from association with any FINRA member inany capacity.

Capacities Affected: All capacities

Duration: N/A


End Date: 06/19/2017

Sanction Type: Suspension






Criminal - Final Disposition

This type of disclosure event involves a criminal charge against the broker that has resulted in a conviction, acquittal, dismissal, or plea. Thecriminal matter may pertain to any felony or certain misdemeanor offenses, including bribery, perjury, forgery, counterfeiting, extortion, fraud, andwrongful taking of property.

Disclosure 1 of 1


Charge Date: 03/15/2017


Status Date: 08/11/2017

Name of Court: U.S. District Court for the District of Minnesota

Location of Court: District of Minnesota

Docket/Case #: 0:17cr61

Formal Charges werebrought in:

Federal Court

Disposition Date: 08/11/2017

Sentence/Penalty: On March 29, 2017, Kluge pleaded guilty to two counts of bank fraud. On August11, 2017, a judgment in the criminal case was entered against Kluge. Kluge wassentenced to a prison term of 50 months followed by 3 years of supervised releaseon each of Counts 1 & 2 to be served concurrently. Kluge was also ordered tomake restitution in the amount of $8,680,489.50.

FormalCharge(s)/Description:

BANK FRAUD

No of Counts: 2

Felony or Misdemeanor: Felony

Plea for each charge: guilty

Disposition of charge: Pled guilty

Charge(s) 1 of 1






Customer Dispute - Settled

This type of disclosure event involves a consumer-initiated, investment-related complaint, arbitration proceeding or civil suit containing allegationsof sale practice violations against the broker that resulted in a monetary settlement to the customer.

Disclosure 1 of 6

Reporting Source: Firm

Employing firm whenactivities occurred which ledto the complaint:

Allegations:

Merrill Lynch, Pierce, Fenner & Smith Incorporated

The Customer alleges unauthorized trading in October 2016.

Product Type: Equity Listed (Common & Preferred Stock)

Alleged Damages: $0.00

Date Complaint Received: 12/07/2016

Complaint Pending? No

Status:


Settlement Amount: $40,004.47

Individual ContributionAmount:

$0.00

Customer Complaint Information

Settled

Alleged Damages AmountExplanation (if amount notexact):

Damages are not specified.

Is this an oral complaint? Yes

Is this a written complaint? No

Is this an arbitration/CFTCreparation or civil litigation?

No

Disclosure 2 of 6

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Allegations:







Allegations: The Customer alleges unauthorized trading in October 2016.





Status:




$0.00


Settled






No

Disclosure 3 of 6

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Allegations:


The Customer alleges unauthorized trading in October 2016.






No18�2021 FINRA. All rights reserved. Report about JEFFREY T. KLUGE.







Status:




$0.00


Settled



No

Disclosure 4 of 6

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Allegations:


The Customer alleges unauthorized trading from October 2016 to November 2016.





Status:


Settled


Damages are not specified




No









$0.00

Disclosure 5 of 6

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Allegations:


The Customer alleges unauthorized trading in October, 2016.





Status:




$0.00


Settled






No

Disclosure 6 of 6

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Reporting Source: Broker







Allegations:

MERRILL LYNCH, PIERCE, FENNER AND SMITH, INC.

THIS VERBAL COMPLAINT AROSE OUT OF THE SALE OF AN AUCTION RATESECURITY (ARS) THAT WAS MADE PRIOR TO THE UNPRECEDENTEDILLIQUIDITY IN THE ARS MARKET THAT OCCURRED IN FEBRUARY 2008.

Product Type: Other: AUCTION RATE SECURITIES-- CLOSED-END FUNDS




Status:


Settlement Amount: $2,125,000.00


$0.00

Broker Statement THIS MATTER INVOLVES THE SALE OF AUCTION RATE SECURITIES (ARS).THE TRANSACTION(S) AT ISSUE TOOK PLACE BEFORE MID-FEBRUARY2008, WHEN THE ARS MARKET SUFFERED WIDESPREAD AUCTIONFAILURES AND ILLIQUIDITY. THE FINANCIAL ADVISOR DID NOT CAUSE,CONTRIBUTE OR HAVE ANY CONTROL WHATSOEVER OVER THESEMARKET EVENTS. THE FIRM REACHED AGREEMENT WITH CERTAIN OF ITSREGULATORS, PURSUANT TO WHICH IT REPURCHASED ARS FOR THEIRFULL PAR VALUE FROM CERTAIN CLIENTS, INCLUDING THE INSTANTCLIENT, WHERE THEY COMPLAINED OR NOT. THE FINANCIAL ADVISORWAS NOT A PARTY TO THAT AGREEMENT, DID NOT MAKE ANY PAYMENT TOTHE CLIENT, AND WAS NOT ASKED TO AND DID NOT CONTRIBUTE TO THEREPURCHASE AMOUNT. THE SETTLEMENT AMOUNT IN ITEM 11 ABOVEREFLECTS THE PAR VALUE OF THE REPURCHASED ARS, AS REQUIRED BYFINRA REGULATORY NOTICE 09-12.


Settled


UNSPECIFIED




No






THIS MATTER INVOLVES THE SALE OF AUCTION RATE SECURITIES (ARS).THE TRANSACTION(S) AT ISSUE TOOK PLACE BEFORE MID-FEBRUARY2008, WHEN THE ARS MARKET SUFFERED WIDESPREAD AUCTIONFAILURES AND ILLIQUIDITY. THE FINANCIAL ADVISOR DID NOT CAUSE,CONTRIBUTE OR HAVE ANY CONTROL WHATSOEVER OVER THESEMARKET EVENTS. THE FIRM REACHED AGREEMENT WITH CERTAIN OF ITSREGULATORS, PURSUANT TO WHICH IT REPURCHASED ARS FOR THEIRFULL PAR VALUE FROM CERTAIN CLIENTS, INCLUDING THE INSTANTCLIENT, WHERE THEY COMPLAINED OR NOT. THE FINANCIAL ADVISORWAS NOT A PARTY TO THAT AGREEMENT, DID NOT MAKE ANY PAYMENT TOTHE CLIENT, AND WAS NOT ASKED TO AND DID NOT CONTRIBUTE TO THEREPURCHASE AMOUNT. THE SETTLEMENT AMOUNT IN ITEM 11 ABOVEREFLECTS THE PAR VALUE OF THE REPURCHASED ARS, AS REQUIRED BYFINRA REGULATORY NOTICE 09-12.






Customer Dispute - Closed-No Action / Withdrawn / Dismissed / Denied

This type of disclosure event involves (1) a consumer-initiated, investment-related arbitration or civil suit containing allegations of sales practiceviolations against the individual broker that was dismissed, withdrawn, or denied; or (2) a consumer-initiated, investment-related written complaintcontaining allegations that the broker engaged in sales practice violations resulting in compensatory damages of at least $5,000, forgery, theft, ormisappropriation, or conversion of funds or securities, which was closed without action, withdrawn, or denied.

Disclosure 1 of 1



Allegations:


The administrator of the estate alleges unsuitable investment recommendationsfrom March 2004 until October 2008.

Product Type: Other: Closed-End Funds




Status:


Settlement Amount:



Denied



Is this an oral complaint? No

Is this a written complaint? Yes


No






End of Report

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jeffrey timothy kluge

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