Costly new FINRA ads – complete with an animated explosion and created by top ad agency Ogilvy & Mather – urge investors to "Check your broker."

Yet the humorous spots fail to mention that BrokerCheck reports routinely omit information many clients would consider critical to assessing a potential advisor's fitness to serve them.

Take, for example, former Securities America broker Mark Preston French, 40. The U.S. Attorney's office in Cincinnati indicted him on fraud charges last week, six days before the ad campaign launched. Prosecutors and the FBI accuse French of allegedly stealing a client's money to buy bars of gold and silver he stored in his basement. But there was no mention of this eye-popping accusation on French's BrokerCheck report earlier this week. Instead, according to BrokerCheck through June 1, French had zero disclosures.

"There's just huge holes in BrokerCheck," says Joe Peiffer, president of the Public Investors Arbitration Bar Association. "If investors go to BrokerCheck and it gives them a false sense of security, then what is the use of BrokerCheck?"

After a call from Financial Planning, FINRA added the pending criminal charges to French's report. Once FINRA becomes aware of new information, it will include it, FINRA spokesman George Smargardis says. 

BrokerCheck reports miss key pieces of information, leaving investors in the dark about numerous blemishes on brokers’ records, according to a PIABA study. BrokerCheck provides an incomplete record of a broker’s background even though some state securities regulators, who rely on the same database, supply the missing information, the advocacy group says.

Much of French's alleged fraud took place during his years at independent broker-dealer Investors Security Company in Westerville, Ohio. Securities America acquired French along with 130 brokers it recruited when it bought Investors Security in 2012.

Securities America declined to comment on French via a spokeswoman. French, who also is no longer registered with FINRA, could not be reached for comment.

BrokerCheck derives its information from detailed reports from the Central Registration Depository, or CRD, that contain frequently unpublished information about ongoing investigations and other issues involving brokers and their firms, says Christine Lazaro, director of the Securities Arbitration Clinic at St. John's University School of Law in Jamaica, N.Y.

Both Lazaro and Peiffer think the BrokerCheck reports should include all of the information from every broker's CRD.

Right now, Florida may be the only state that provides the public with full CRD reports on brokers there, Lazaro says. New York residents who request CRDs from their state securities regulators, for example, are referred to BrokerCheck, she says.

Given that BrokerCheck reports are incomplete, FINRA needs to inform investors of this fact with a disclosure on the BrokerCheck report site, Lazaro says. "They are not the one stop source of information and that should be acknowledged," Lazaro says.

FINRA is on the right track in urging clients to use BrokerCheck, Lazaro thinks, given that so few investors conduct any research at all about prospective advisors; it just needs to disclose its own failings.

"For customers to have some info about their brokers, it's helpful for investors to be doing some due diligence," she says, including going beyond BrokerCheck

French's alleged history of hording precious metals, for example,  turned up immediately in a Google search. 

Read more: