FINRA suspends former Portsmouth Financial Services compliance officer Randy Cleve Fox over unpaid $82,600 GWG L Bond arbitration award
If you won a FINRA arbitration award and the person ordered to pay it hasn’t, FINRA can suspend that person from associating with any FINRA member firm. On May 6, 2026, it suspended Randy Cleve Fox (CRD# 2726566), formerly the chief compliance officer of Portsmouth Financial Services, after a customer’s $82,600 arbitration award over GWG L Bonds went unpaid. According to BrokerCheck, “Respondent Fox is suspended on May 6, 2026 for failure to comply with an arbitration award or settlement agreement or to satisfactorily respond to a FINRA request to provide information concerning the status of compliance.” BrokerCheck records show that Fox is not currently registered. His last registration was with GT Securities, Inc. in Los Angeles, from 01/2023 to 04/2024.
BrokerCheck records show one regulatory event and one customer dispute on Fox’s record. Both are final.
The GWG L Bond claim and the $82,600 award
The arbitration is FINRA case 24-01755. According to the award, the customer filed a statement of claim against Portsmouth Financial Services and Fox on or about August 15, 2024. BrokerCheck lists Portsmouth Financial Services as the employing firm and states that “Fox was named in a customer complaint that asserted the following causes of action: negligent and improper conduct; breach of contract; breach of fiduciary duty; negligence; negligent supervision; and violation of applicable laws and industry rules. The causes of action relate to an investment in allegedly unsuitable, high-risk L bonds, issued by GWG Holdings (“GWG L Bonds”).” The alleged damages were $120,000.00. The award states that at the hearing, the customer “requested damages of $210,108.56.”
Portsmouth’s own report of the dispute describes the allegations as “Negligent supervision and due diligence, improper conduct, breach of fiduciary duty. Approval of unsuitable, illiquid investment.” According to his BrokerCheck employment history, Fox was Portsmouth’s Chief Compliance Officer from 05/2020 to 12/2022. Neither the award nor BrokerCheck says who recommended the L Bonds to the customer.
The customer dismissed the claim against Portsmouth in December 2025, before the January 2026 hearing. According to the award, on December 14, 2025, the customer filed “a notice of voluntary dismissal with prejudice as to PFS only,” and the panel made no determination on the claims against the firm. In calculating damages, the award subtracts the $20,000 “from the settlement and release agreement between Claimant and PFS”.
The claims against Fox went to a hearing before an all-public panel, and Fox appeared pro se. The award states that “Fox is liable for and shall pay to Claimant the sum of $82,600.00 in compensatory damages, which is comprised of compensatory damages of $120,000.00, minus the income of $17,400.00 from the GWG L Bond investment, and minus the $20,000.00 from the settlement and release agreement between Claimant and PFS.” The panel also ordered Fox to pay interest “at the rate of 7.75% per annum from January 9, 2026, through and including the date the balance is paid in full.” The award was served on February 20, 2026.
Fox asked the panel to expunge Occurrence Number 2378766 from his CRD record. According to the award, his “request for expungement of Occurrence Number 2378766 from registration records maintained by the CRD is denied with prejudice. The Panel’s decision was unanimous.” The panel denied the customer’s request for punitive damages.
Why FINRA suspended Fox
BrokerCheck’s report of the award states: “The award has not been paid by or on behalf of Randy Fox as of May 6, 2026.” FINRA suspended Fox the same day. According to BrokerCheck, the suspension covers all capacities, with an indefinite duration and no end date listed. BrokerCheck lists the resolution as a “Letter”, and the regulator statement cites “Article VI, Section 3 of FINRA By-Laws, and FINRA Rule 9554”.
This was not a settlement with FINRA, and FINRA made no findings about the L Bond sale. BrokerCheck answers “No” to whether the order is based on violations of laws that prohibit fraudulent, manipulative, or deceptive conduct. FINRA’s July 2026 disciplinary actions report lists Fox among individuals suspended for failing to comply with an arbitration award.
GWG L Bonds and the investors who bought them
GWG Holdings sold L Bonds through broker-dealers. FINRA described the product in a separate June 2026 action against a different firm, WestPark Capital. According to that AWC, “L Bonds were not directly secured by GWG’s life insurance portfolio and were not rated by any bond rating agency.” The same AWC states that the offering documents for GWG’s fourth L Bond offering, which began in June 2020, “stated that the bonds could be considered speculative, involved a high degree of risk, were illiquid, and were only suitable for persons with substantial financial resources and with no need for liquidity.”
According to the WestPark AWC, GWG defaulted on its obligations to L Bond investors in January 2022 and filed for bankruptcy in April 2022.
The rules behind the suspension
FINRA Rule 9554 lets FINRA act when someone it regulates “fails to comply with an arbitration award or a settlement agreement related to an arbitration or mediation”. After written notice, a member firm can have its membership suspended or cancelled, and an individual can be suspended from association with any member firm. FINRA Rule 12904(j) requires monetary awards to be paid unless a motion to vacate has been filed in court, and it provides for interest on awards that are not timely paid or as the panel specifies in the award.
The customer’s claims included allegations of negligent supervision and of an unsuitable investment. FINRA Rule 3110 requires every member firm to maintain a supervisory system reasonably designed to achieve compliance with the securities laws and FINRA rules. FINRA Rule 2111 requires a reasonable basis to believe a recommendation is suitable for the customer. Since June 30, 2020, it no longer applies to recommendations covered by Regulation Best Interest (17 C.F.R. § 240.15l-1), which governs recommendations to retail customers. Neither the award nor BrokerCheck gives the date of this customer’s purchase.
What investors can do about an unpaid award
A FINRA suspension bars Fox from associating with any FINRA member firm, but it does not pay the customer. Under the Federal Arbitration Act, 9 U.S.C. § 9, where the parties agreed that a court’s judgment shall be entered on the award, a party can apply to a court for an order confirming it, and the court must grant the order unless the award is vacated, modified, or corrected. Whether confirmation leads to an actual recovery depends on whether the person ordered to pay has assets to collect.
Here, the customer also had a claim against the firm, which was settled before the hearing. Investors who bought GWG L Bonds through a brokerage firm may have claims in FINRA arbitration against the firm and the individuals involved. What can be recovered depends on the facts of each account.
Steps to Take Right Now
- Gather your account statements, trade confirmations, and any correspondence with your broker or firm, including emails, texts, and written materials about the investments.
- Look up your broker on FINRA BrokerCheck at brokercheck.finra.org to review their full disclosure record.
- Contact a securities arbitration attorney for a consultation to evaluate your options.
Rosenberger + Kawabata represents retail investors in FINRA arbitration proceedings involving unsuitable high-risk bond recommendations, negligent supervision, and unpaid arbitration awards. Contact Rosenberger + Kawabata online for a free and confidential consultation, or call (310) 894-6921.
The information in this post comes from FINRA’s public records, including FINRA Arbitration Award No. 24-01755, and BrokerCheck database. You can view the full detailed report (CRD# 2726566) here.
You can view the full July 2026 FINRA disciplinary actions report here.