Compliance firm sues BD over alleged unpaid fees

A compliance firm that works with broker-dealers and registered investment advisors, My RIA Lawyer, has sued a mid-sized broker-dealer, Concorde Investment Services, claiming that Concorde has failed to pay $182,172 for compliance and legal work.

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Lawsuits between third-party vendors and broker-dealers or RIAs are uncommon in the relatively small wealth management marketplace; neither vendors or firms that house financial advisors and provide services for them desire to gain reputations for being litigious.

Based in suburban Atlanta, My RIA Lawyer, which is also known as the Shaver Law Group, sued Concorde Investment Services, which is based in Ann Arbor, Michigan, in November in state court, alleging breach of contract and seeking back legal fees for work it did for the broker-dealer in 2024.

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On Friday, Concorde Investment Services, which has close to 150 independent reps in about 50 offices, filed a motion in US District Court in Atlanta, to move the lawsuit to federal court.

Concorde Asset Management, the RIA side of the franchise, manages $395 million of client assets, according to the firm’s Form ADV.

Danielle Delongchamp, CEO of Concorde Investment Services, did not return a call on Monday to comment about the legal dispute. Leila Shaver, founder of My RIA Lawyer, also did not return a call to comment.

The dispute appears to stem from a disagreement over how fees were to be paid for the compliance firm’s work.

According to the complaint filed in November, Concorde Investment Services hired My RIA Lawyer last May “for various regulatory and compliance services” for a subscription fee of $17,500 for a term of 24 months.

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The initial agreement, according to My RIA Lawyer’s complaint, stipulated for the firm’s work to be converted to an hourly rate if the contract were to be terminated before the stated time period.

After five months, Concorde Investment Services terminated the agreement with My RIA Lawyer “despite being reminded of the hourly fee provision,” according to the lawsuit. 

From last May to September, Concorde paid My RIA Lawyer $87,500 in fees, according to the court documents. Once the contract ended, My RIA Lawyer converted the total charges to $269,672 and subtracted the amount paid. That let a remaining balance of $182,172, which Concorde “refused” to pay, according to court documents.

The Financial Industry Regulatory Authority Inc. in November censured and fined Concorde Investment Services $110,000 after an investigation revealed it failed to supervise advisors who recommended excessively risky alternative investments to half a dozen clients.

According to Finra, Concorde failed to ensure that recommendations involving limited partnership interests from GPB Capital Holdings were suitable for six of its clients.