According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) broker Richard Siminou (Siminou), currently associated with Kingswood Capital Partners, LLC, has been subject to at least 3 disclosable events. These events include one customer complaint, 2 regulatory events. Several of those complaints against Siminou concern allegations of high frequency trading activity also referred to as churning or excessive trading among other securities laws violations.
FINRA BrokerCheck shows a final customer complaint on September 18, 2023.
On or about August 18, 2023, without admitting or denying the findings, Siminou entered into Acceptance, Waiver and consent (‘AWC’) with FINRA wherein Siminou consented to the entry of findings that he engaged in excessive and unsuitable trading in the accounts of two elderly customers. Siminou recommended purchases which resulted in an annualized cost-to-equity ratio requiring investments to grow by more than 29 percent and 34 percent, respectively, just to break even. As a result of Siminou’s unsuitable recommendations, the customers paid $17,021 in commissions and fees. Siminou was suspended for a period of four (4) months and agreed to pay a fine in the amount of $5,000 and to pay restitution of $17,201 plus interest.
FINRA BrokerCheck shows a final customer complaint on August 31, 2023.
Without admitting or denying the findings, Siminou consented to the sanctions and to the entry of findings that he excessively and unsuitably traded two elderly customer accounts. The findings stated that this trading resulted in an annualized cost-to-equity ratio of over 29 percent and 34 percent, respectively. As a result of Siminou’s unsuitable recommendations, the customers paid $17,021 in commissions and fees.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $9,380.04 on August 31, 2023.
SUITABILITY, FAILURE TO SUPERVISE AND NEGLIGENCE.
Should a broker participate in excessive trading, or churning, they may repeatedly buy and sell securities, occasionally even the same stock, within a short span of time. Every month, the account often completely “turns over” with different securities. The only purpose of this investment trading activity in any client’s account is to generate commissions that benefit the broker, not the investor. In the realm of securities law, churning is classified as a type of fraud. Excessive trading of securities, broker manipulation of the account, and the intent to deceive the investor for illicit commissions form the basis of the claim. A similar claim, excessive trading, under FINRA’s suitability rule involves just the first two elements. Certain commonly used measures and ratios used to determine churning help evaluate a churning claim. These ratios look at how frequently the account is turned over plus whether or not the expenses incurred in the account made it unreasonable that the investor could reasonably profit from the activity.
According to newsources, a study revealed that 7.3% of financial advisors had a customer complaint on their record when records from 2005 to 2015 were examined. Brokers must publicly disclose reportable events on their BrokerCheck reports that include customer complaints, IRS tax liens, judgments, investigations, terminations, and criminal cases. In addition, research has shown a disturbing pattern with troublesome brokers where brokers with high numbers of customer complaints are not kicked out of the industry but instead these brokers are sifted to lower quality brokerage firms with loose hiring practices and higher rates of customer complaints. These lower quality firms may average brokers with five times as many complaints as the industry average.
Siminou entered the securities industry in 2008. Siminou has been registered as a Broker with Kingswood Capital Partners, LLC since 2024.
Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. At Gana Weinstein LLP, our attorneys are experienced representing investors who have suffered securities losses due to the mishandling of their accounts. Claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.