(CRD #2709698, Kings Park, New York)

November 20, 2025 – Gustave James Schmidt Jr. was named a respondent in a FINRA complaint alleging he engaged in a course of conduct that deceived investors and made material omissions regarding the compensation that he and his member firm would receive in connection with various private placement offerings. The complaint alleges that Schmidt recommended that his customers make purchases of interests in pre-initial public offering (IPO) companies through various private placement offerings, with a total principal value of $437,100. The offering documents, including a private placement memorandum, private placement series supplement, operating agreement, and subscription documents that Schmidt reviewed and caused to be provided to customers in connection with Schmidt’s recommendations disclosed that he and his firm would receive “up to ten percent” placement fee from sales of the offerings. Schmidt knew, however, that the offerings’ issuer had promised to pay the firm and, thus, Schmidt in addition to the maximum amount of compensation disclosed to investors, ten percent, an additional five percent fee, as well as half of any profits collected by the issuer. Ultimately, Schmidt received at least $19,888.05 in undisclosed compensation. The complaint also alleges that Schmidt willfully violated Reg BI by failing to fully and fairly disclose in writing material facts relating to conflicts of interest and failing to conduct a reasonable investigation, or due diligence, to understand the offerings and reach a reasonable conclusion that they were in the best interests of at least some investors. (FINRA Case #2022074096805) If you have suffered losses as a result of Gustave James Schmidt Jr.’s act and/or actions, we would like to hear from you. We are currently investigating claims on behalf of clients who have suffered significant losses in their portfolios that are managed by Gustave James Schmidt Jr. The Schwartz Law Firm represents investors in claims against financial advisors and their firms. If you have questions about your potential claim or need assistance from an investment fraud lawyer, please contact us at  (813) 226-3372 or email Matthew Schwartz directly at mschwartz@tslfirm.com.