Walter S. Schram Investment Fraud Investigation: Multiple Customer Disputes and Financial Issues Raise Red Flags

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Michigan Financial Advisor’s History of Customer Complaints and Financial Compromises Warrants Scrutiny

Walter S. Schram (CRD# 1728096), a financial advisor currently registered with Ameriprise Financial Services in Farmington Hills, Michigan, has a concerning history of customer disputes and financial issues that should raise significant red flags for investors. According to his FINRA BrokerCheck report, Schram has been the subject of multiple customer complaints and has a pattern of financial compromises with creditors that calls into question his financial stability and judgment.

Most concerning is a current pending FINRA arbitration case seeking $300,000 in damages related to alternative investments that were allegedly unsuitable for the investor. If you’ve invested with Walter Schram at Ameriprise Financial Services, UBS Financial Services, or any other firm, you may have grounds to recover investment losses through FINRA arbitration.

Walter S. Schram: Professional Background and Registration History

Walter Schram is a veteran financial advisor with a career spanning over three decades in the securities industry. According to his FINRA BrokerCheck report, his professional history includes:

• Current position: Registered Representative at Ameriprise Financial Services, LLC (since August 2017)
• Previous employment: UBS Financial Services (2006-2017), Citigroup Global Markets (1993-2006), Lehman Brothers (1988-1993), and E.F. Hutton & Company (1987-1988)
• Licenses: Series 7 (General Securities Representative), Series 3 (National Commodity Futures), Series 63 (Uniform Securities Agent State Law), and Series 65 (Uniform Investment Adviser Law)
• Registration status: Currently registered in 24 U.S. states and territories
• CRD Number: 1728096 (unique identifier in FINRA’s Central Registration Depository)
• Branch locations: 32255 Northwestern Hwy, Suite 200, Farmington Hills, MI 48334-1574 and West Bloomfield, MI

Schram maintains extensive registrations across numerous states and self-regulatory organizations. He is registered as both a broker (selling securities) and an investment adviser (providing investment advice) through Ameriprise Financial Services, giving him significant latitude in the types of investment products and services he can offer to clients.

Troubling Pattern of Customer Disputes

Schram’s BrokerCheck report reveals a pattern of customer complaints that raises serious concerns about his investment practices:

Current Pending $300,000 Arbitration Case

The most recent and significant complaint involves a FINRA arbitration filed in January 2025 (Case #24-01773) alleging that UBS Financial Services failed to conduct adequate due diligence on a fund of funds that was allegedly “unsuitable for any investor.” The complaint claims that, as a result, all relevant risks were not disclosed to investors. The claimant is seeking $300,000 in damages.

This case covers investment activities from May 2012 to 2023, spanning Schram’s time at both UBS Financial Services and his transition to Ameriprise. The allegation that the fund of funds was “unsuitable for any investor” is particularly concerning, as it suggests a fundamental failure in the due diligence process for recommending alternative investments.

Previous Settled Complaint Involving Structured Products

In 2012, while Schram was at UBS Financial Services, a client filed a FINRA arbitration (Case #12-00318) alleging “misrepresentations and omissions in connection with the purchase of a structured product” from 2008. Specifically, the complaint involved a Lehman Brothers principal-protected note that lost value during the 2008 financial crisis when Lehman Brothers declared bankruptcy.

This complaint was settled for $35,000, with UBS paying the full amount without contribution from Schram. In his broker statement, Schram noted that the complaint was filed by his uncle, who “did not name me as a respondent,” and that “UBS chose to settle this matter without seeking contribution from me.” The settlement amount was less than the alleged damages of $50,000.

Concerning Pattern of Financial Compromises

Particularly troubling for a financial professional entrusted with client assets is Schram’s extensive history of financial compromises with creditors. His BrokerCheck report discloses six separate creditor compromises between April 2015 and January 2016:

1. April 2015: Settled a $8,249.75 debt with Bank of America for $3,713.00 (approximately 45% of the original amount)
2. May 2015: Settled a $1,462.28 debt with US Bank for $732.00 (approximately 50% of the original amount)
3. November 2015: Settled a $25,009.51 debt with Bank of America for $13,000.00 (approximately 52% of the original amount)
4. November 2015: Settled a $4,265.08 debt with Chase for $1,920.00 (approximately 45% of the original amount)
5. January 2016: Settled a $14,024.15 debt with Bank of America for $7,000.00 (approximately 50% of the original amount)
6. January 2016: Settled a $1,482.74 debt with Bank of America for $670.00 (approximately 45% of the original amount)

In total, Schram compromised on over $54,493.51 in debt over a nine-month period, negotiating settlements that forgave approximately $27,458.51 (about 50%) of his obligations. This extensive pattern of financial compromises raises serious questions about Schram’s personal financial management and judgment. The concentration of these events in 2015-2016 also corresponds with the latter part of his employment at UBS Financial Services, shortly before his transition to Ameriprise in 2017.

Understanding Alternative Investment Concerns

The pending $300,000 arbitration specifically cites concerns with a “fund of funds” alternative investment. Alternative investments, including fund of funds structures, present unique risks that may make them unsuitable for many retail investors:

Risks of Fund of Funds Structures

Fund of funds investments are complex products that invest in multiple underlying funds rather than directly in securities. These structures often present specific concerns:

• Multiple layers of fees: Investors typically pay fees at both the fund of funds level and within each underlying fund, creating a “double fee” structure that can significantly erode returns
• Reduced transparency: The complex structure can make it difficult for investors to understand exactly what they own and the true risks involved
• Limited liquidity: Many fund of funds investments have significant lockup periods or limited redemption windows, restricting investors’ access to their capital
• Complex tax reporting: These structures often generate complicated tax reporting requirements that can create additional costs and complexities for investors
• Manager selection risk: Returns depend heavily on the fund manager’s ability to select successful underlying funds
• Increased operational risks: Multiple investment layers create additional operational complexities and risks

Heightened Due Diligence Requirements

The pending arbitration specifically alleges failure to conduct adequate due diligence. For alternative investments like fund of funds structures, proper due diligence is especially critical and should include:

1. Thorough investigation of the fund manager’s background, experience, and track record
2. Comprehensive analysis of the investment strategy and methodology
3. Review of underlying fund managers and their strategies
4. Evaluation of fee structures at all levels and their impact on potential returns
5. Assessment of liquidity terms and restrictions
6. Analysis of conflicts of interest throughout the investment structure
7. Verification of third-party service providers like administrators and auditors
8. Stress testing of how the investment might perform in various market scenarios

Failure to conduct and document this level of due diligence, or to adequately communicate the results to clients, can constitute a serious breach of a financial advisor’s duties to clients.

Legal Options for Investors Who Suffered Losses

If you invested with Walter Schram and experienced investment losses, particularly in alternative investments or structured products, several legal remedies may be available:

FINRA Arbitration Process

The Financial Industry Regulatory Authority (FINRA) provides a specialized forum for resolving disputes between investors and their brokers:

• Efficiency: FINRA arbitration typically concludes more quickly than court litigation, often within 12-18 months
• Expertise: Arbitration panels generally include individuals with securities industry knowledge
• Less formal: Arbitration proceedings have less stringent evidentiary and procedural requirements than court cases
• Binding decisions: Arbitration awards are final and binding with limited grounds for appeal
• Cost-effective: The process is generally less expensive than pursuing litigation in court

Potential Legal Claims

Investors may have valid claims under several legal theories:

• Unsuitability: Financial advisors must recommend only investments that align with a client’s financial situation, investment objectives, risk tolerance, and investment time horizon
• Misrepresentation/omission: Failure to disclose material facts about an investment’s risks, costs, or features
• Breach of fiduciary duty: When acting as an investment adviser, financial professionals have a fiduciary duty to act in their clients’ best interests
• Negligence: Failure to exercise reasonable care in making investment recommendations
• Over-concentration: Placing too much of a client’s portfolio in a particular investment type or sector
• Failure to supervise: Claims against the brokerage firm for inadequate oversight of their representative

Time Limitations for Filing Claims

It’s crucial to act promptly if you believe you’ve suffered losses due to misconduct:

• FINRA arbitration claims must generally be filed within six years of the events giving rise to the dispute
• Certain claims may be subject to shorter statutes of limitations under state or federal law
• Delays in filing claims can impact the availability of evidence and witness testimony

For investors who worked with Schram during his UBS Financial Services tenure (2006-2017) or early Ameriprise period, the window for filing claims may be closing on older transactions.

Red Flags in Schram’s Background for Investors

Schram’s BrokerCheck report presents several concerning elements that current and prospective clients should carefully consider:

1. Multiple Firm Transitions

Schram has worked at five different brokerage firms throughout his career, with his most recent move from UBS Financial Services to Ameriprise Financial Services in 2017. While broker moves are not uncommon in the industry, they warrant additional scrutiny, particularly when they follow customer complaints or other issues.

2. Pattern of Financial Issues

The six financial compromises within a nine-month period in 2015-2016 indicate significant personal financial difficulties shortly before Schram’s transition to Ameriprise. Such financial pressure can potentially create conflicts of interest, as advisors may face incentives to generate additional commission income.

3. Alternative Investment Focus

The pending complaint’s focus on alternative investments, specifically a fund of funds structure, should alert investors who have similar investments in their portfolios with Schram. These complex products require specialized expertise to recommend appropriately and often carry higher fees that can benefit advisors.

4. Outside Business Activities

Schram’s BrokerCheck report indicates multiple real estate ownership interests, including:

• Multi-Family properties (Cali-McAllen LLC)
• Commercial properties (Joslyn Road, OLHSA Building LLC, PAE Gymnasium Complex LLC)
• Other real estate investments in Bloomfield Hills and Auburn Hills, Michigan

While outside business activities are not inherently problematic, they can potentially create conflicts of interest or divert attention from an advisor’s securities business.

Choosing Experienced Securities Attorneys

Recovering investment losses requires specialized legal knowledge. When selecting attorneys to evaluate potential claims against Schram or his employing firms, consider these factors:

• Securities law focus: Look for attorneys who concentrate their practice in securities arbitration and litigation
• FINRA arbitration experience: Seek counsel with extensive experience specifically in FINRA proceedings
• Track record with similar cases: Ask about experience with alternative investments and structured products
• Resources for case development: Securities cases often require detailed documentation review and expert testimony
• Transparent fee arrangements: Many securities attorneys work on contingency, collecting fees only if they recover money for you
• Professional affiliations: Consider membership in organizations like the Public Investors Advocate Bar Association (PIABA)

Protecting Your Investment Portfolio

Whether you’re a current or former client of Walter Schram, consider these steps to protect your investments:

• Request a complete portfolio review by an independent financial advisor with no connection to Schram or his firms
• Obtain and review all account statements for unusual activity, excessive fees, or unauthorized transactions
• Question complex investments in your portfolio that you don’t fully understand
• Check for concentration issues where too much of your portfolio may be allocated to similar investment types
• Verify all fees you’re paying, both transparent and embedded within investment products
• Document all communications with your financial advisor, including recommendations and concerns raised
• Research your advisor through FINRA BrokerCheck (brokercheck.finra.org) and other public resources

Your Final Destination to Take Action Today

If you invested with Walter S. Schram at Ameriprise Financial Services, UBS Financial Services, or any other firm and experienced significant losses, particularly in alternative investments or structured products, it’s critical to have your situation evaluated by experienced securities attorneys.

The consultation is free, confidential, and comes with no obligation. Given the time limitations for filing claims, prompt action is essential to preserve your legal rights.

Call 800-950-6553 or complete our online form to schedule your no-obligation case evaluation.

Disclaimer: This article is for informational purposes only and does not constitute legal advice. The allegations described regarding Walter S. Schram have not been proven in a court of law or FINRA proceeding. Each investment situation requires individual analysis, and recovery outcomes depend on the specific circumstances of each case.

Chetan Patil

Chetan Patil is the founder and Managing Partner of the Patil Law. He brings over 15 years of extensive experience in diverse complex disputes and transactions, across the country. Mr. Patil specializes in litigations, trials, arbitrations, and appeals of complex securities, FINRA, financial and business disputes, with an emphasis in securities, financial services, and financial regulatory law.