The securities lawyers of Gana LLP are investigating a customer complaint filed with Financial Industry Regulatory Authority (FINRA) against broker Ziv Ohel (Ohel). According to BrokerCheck records, Ohel has been subject to at least seven customer complaints, one regulatory action and one employment separation for cause among other claims. The customer complaints against Ohel allege securities law violations that include unsuitable investments, churning, and failure to follow instructions among other claims.
The most recent customer complaint was filed in November 2016 alleging damages stemming from unauthorized investments made in October 2016. The complaint settled for $20,000. The complaint was settled for $30,996.00.
In January 2017, the state of Michigan filed a claim alleging that Ohel engaged in dishonest or unethical practices within the last 10 years. In addition, Ohel was terminated from his position at Ameriprise Financial on October 25, 2016 for policy violations including receiving a loan from and being named in fiduciary capacities for a client of the firm.
Ohel entered the securities industry in 1992. Ohel was associated with the following firms throughout his career:
• Merrill Lynch Pierce, Fenner & Smith Inc. (September 1992 – November 1999)
• Citigroup Global Markets Inc. (November 1999 – June 2009)
• Morgan Stanley (June 2009 – November 2012)
• Ameriprise Financial Services Inc. (November 2012 – October 2016)
• CFD Investments, Inc. – Kokomo, IN branch (November 2016 – present)
Brokers have a responsibility to treat investors fairly which includes obligations such as making only suitable investments for the client. In order to make a suitable recommendation the broker must meet certain requirements. First, there must be reasonable basis for the recommendation the product or security based upon the broker’s investigation and due diligence into the investment’s properties including its benefits, risks, tax consequences, and other relevant factors. Second, the broker then must match the investment as being appropriate for the customer’s specific investment needs and objectives such as the client’s retirement status, long or short term goals, age, disability, income needs, or any other relevant factor.
Excessive trading or “Churning” is essentially investment trading activity that is excessive and serves little useful purpose. Brokers excessively trade or churn solely to generate commissions for the broker. The elements to establish a churning claim are:
• Excessive purchases and sales of securities for the purpose of generating commissions; and
• Broker control.
In order to determine whether trading has been excessive, two commonly measured metrics are used: the account’s ‘annualized turnover ratio’ and its ‘cost to equity ratio,’ which is also known as its ‘break even percentage.’ When reviewing churning cases, it is important to determine the broker’s commission rate and total commissions in the account as well as the excessive trading in the account. When the commissions are high, it serves as additional evidence for a claim of churning.
The investment fraud attorneys at Gana LLP represent investors who have suffered securities losses due to the unsuitable investments and/or excessive trading of their accounts. The majority of these claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.