We have seen too many cases where a broker quietly diverts client money into side deals that the firm never approves. Todd Peter Arnoldussen is the latest example. FINRA suspended him for four months and fined him $10,000 after he allegedly used customer funds to participate in an undisclosed private investment.
Case summary: what Arnoldussen did
FINRA Case #2024083942501 outlines a pattern that should alarm any conservative investor. Arnoldussen, associated with a FINRA-member broker-dealer in Kaukauna, Wisconsin, allegedly engaged in undisclosed private securities transactions. He reportedly participated in an investment opportunity alongside a customer and used customer funds to help fund the arrangement.
The core violation was not the investment itself. It was the complete absence of disclosure. FINRA rules require brokers to notify their firms of any outside business activity or private securities transaction. Arnoldussen failed to do so. His firm had no opportunity to review the deal, assess suitability, or supervise the risk.
| Detail | Value |
|---|---|
| Broker | Todd Peter Arnoldussen |
| CRD Number | 1929970 |
| Location | Kaukauna, Wisconsin |
| Fine | $10,000 |
| Suspension | March 2, 2026 through July 1, 2026 |
| FINRA Case | 2024083942501 |
| Violation | Undisclosed private securities transactions using customer funds |
How private securities transactions hurt retirees
Private securities transactions are among the most dangerous violations for older investors. When a broker funnels client money into an outside deal, the investor loses every layer of protection that a regulated brokerage account provides. The firm does not custody the assets. The statements do not reflect the holdings. FINRA arbitration may not cover the loss if the transaction was never reported.
Retirees are especially vulnerable because they often trust their advisors implicitly. A broker who has managed an account for years can exploit that relationship. They may pitch the private deal as an exclusive opportunity with above-market returns. The language is carefully chosen to bypass the investor’s normal caution.
In many cases, the broker does not take direct compensation from the private deal. That makes it harder to detect. The broker may receive equity, a future payout, or simply a favor from the promoter. FINRA rules prohibit undisclosed participation regardless of compensation. The violation is the failure to tell the firm.
Red flags that investors should have spotted
Brokers who run side deals often drop subtle hints. They may mention an exclusive opportunity that bypasses the firm’s compliance department. They may ask for checks made out to entities other than the broker-dealer. In Arnoldussen’s case, the use of customer funds for a private investment was the critical warning sign.
Investors should always confirm that every transaction clears through their official brokerage account. Any request to wire money to a third party, or to write a check directly to an advisor, is a serious red flag. Legitimate investments flow through established custodians with transparent statements and regular reporting.
Another warning is when a broker discourages you from telling the firm about an investment. If an advisor says the deal is private or asks you to keep it confidential, that is a violation of basic compliance norms. No legitimate investment requires secrecy from your own brokerage.
What this means for conservative portfolios
Conservative investors aged 55 to 75 typically prioritize capital preservation over speculative gains. A broker who diverts funds into undisclosed private deals violates that trust at the most basic level. The $10,000 fine and four-month suspension are modest compared to the potential losses a customer could face.
FINRA’s public disciplinary database, BrokerCheck, now carries this mark on Arnoldussen’s record. Any investor considering working with him in the future can see the suspension and the underlying conduct. We encourage every investor to review BrokerCheck before hiring any financial advisor.
Private securities transactions are especially dangerous for retirees because they often lack liquidity, transparent pricing, and regulatory oversight. When a broker fails to disclose such activity, the investor loses the safety net of firm supervision and FINRA arbitration protections.
Haselkorn & Thibaut fights for investor recovery
Haselkorn & Thibaut is a securities law firm founded by former Wall Street defense attorneys who shifted their practice to represent investors. The firm has recovered over $520 million for clients in securities matters and maintains a 98 percent success rate in resolved nontraded REIT cases. Attorneys are AV Preeminent rated through Martindale-Hubbell, designated as Super Lawyers, and hold a 5.0-star client review average. The firm operates on a contingency basis — no recovery, no fee.
Contact Haselkorn & Thibaut today
Time matters in securities recovery cases. The earlier you act, the stronger your position. The firm offers a free case evaluation to assess your losses, review your account history, and explain your options under arbitration or settlement.
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Disclaimer: The information in this article is for informational purposes only and does not constitute legal advice. Every case is different. Past results do not guarantee future outcomes.
