David Escarcega: Center Street Advisor Faces GWG L Bond Complaints

At least two current or former customers of Center Street Securities advisor David Escarcega (CRD# 4367584) are listed as creditors for investments in GWG L Bonds and/or preferred stock, according to records filed with a US bankruptcy court. These records describe investments totaling more than $300,000. Financial Industry Regulatory Authority records show that the former Phoenix, Arizona-based advisor has been sanctioned by securities regulators in connection with alleged rule violations.

Mr. Escarcega’s BrokerCheck report discloses several recent investor complaints, including complaints stemming from investments in GWG. The most recent, filed in June 2022, alleges that as a representative of Center Street Securities, he recommended an unsuitable GWG L bond investment. The pending complaint alleges damages of $250,000.

A second investor complaint, filed in in 2022, alleges that he recommended an unsuitable GWG investment in 2012, while he was a representative of Center Street Securities. The pending complaint alleges damages of $383,014.45.

A third investor complaint, filed in June 2022, similarly alleged an unsuitable GWG L bond recommendation. The pending complaint alleges damages of $30,000. A fourth complaint, filed in 2022, alleged that he recommended three unsuitable alternative investments that resulted in an over-concentration in the customer’s account. The pending complaint alleges damages of $50,000.

A fifth investor complaint, filed in 2018, alleged that he recommended unsuitable investments in a CNL Lifestyle REIT and a mutual fund. The complaint reached a settlement of $20,000.

FINRA issued an enforcement action against Mr. Escarcega in August 2014, according to a disclosure on his BrokerCheck report. The complaint detailed allegations that he “made false and misleading oral and written statements to customers in connection with their purchases of renewable secured debentures, which are an illiquid and high-risk alternative investment.” He allegedly recommended that twelve customers purchase invest $1.5 million in the products, according to the sanction, which states that these recommendations were not suitable for “his elderly and retired customers’ investment objectives and risk tolerances,” and further that they led to “an excessive concentration” in the customers’ accounts. In connection with these findings, he was indefinitely barred from associating with any FINRA member firm and was ordered to pay disgorgement of $52,270.

According to the Financial Industry Regulatory Authority, David Escarcega holds 14 years of securities industry experience. Most recently based in Phoenix, Arizona as a representative of Center Street Securities (2010-2016), his registration history includes Chase Investment Services, Lincoln Financial Securities Corporation, Mony Securities Corporation, MML Investors Services, and Pruco Securities Corporation. He is not registered as a broker or as an investment advisor with any FINRA member firm. (Information current as of June 7, 2023.)

Carlson Law has represented at least nine investors in claims against their financial advisors for investments in GWG Holdings Inc. If you or a loved one have suffered investment losses, please call us at 888-976-6111 or complete our contact form for a free and confidential consultation.