According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker Michael Raineri (Raineri), previously associated with Securities America, INC., has at least 3 disclosable events. These events include one customer complaint, 2 regulatory events, alleging that Raineri recommended unsuitable investments in different investment products including debt securities among other allegations and complaints.
FINRA BrokerCheck shows a final customer complaint on July 01, 2024.
S-23-3545-24-CO01 – On August 26, 2024, the Securities Division entered into a Consent Order with Michael Patrick Raineri (Raineri) of Seattle, Washington. Raineri was previously an investment adviser representative at Securities America Advisors, Inc. and a securities salesperson at Securities America, Inc. The Securities Division previously entered a Statement of Charges against Raineri on July 1, 2024. The Statement of Charges alleged that Raineri engaged in dishonest and unethical practices and violated the anti-fraud provisions of the Securities Act of Washington in connection with funds that he received from an elderly client. In settling the matter, Raineri neither admitted nor denied the allegations, but agreed to cease and desist from violating the Securities Act and to denial of any future securities registration applications. Raineri further agreed to pay a fine of $20,000 and reimburse the Securities Division $5,000 for its costs of investigation. Raineri waived his right to a hearing and to judicial review of the matter.\, \, \, S-23-3545-23-SC01 – Michael Patrick Raineri -Statement of Charges\, On July 1, 2024, the Securities Division entered a Statement of Charges and Notice of Intent to Enter Order to Cease and Desist, to Deny Future Registrations, to Impose a Fine, and to Charge Costs (\\u201cStatement of Charges\\u201d) against Michael Raineri (\\u201cRespondent\\u201d) of Seattle, Washington. Raineri was previously an investment adviser representative at Securities America Advisors, Inc. and a securities salesperson at Securities America, Inc. The Statement of Charges alleges that the Respondent violated Raineri engaged in dishonest and unethical practices and the anti-fraud provisions of the Securities Act of Washington in connection with funds that he received from an elderly client. The Securities Division intends to order the Respondent to cease and desist from violating the Securities Act of Washington and gives notice of its intent to deny future registrations, impose a fine, and to charge costs. The Respondent has a right to request a hearing on the Statement of Charges.\,
FINRA BrokerCheck shows a final customer complaint on April 18, 2023.
Without admitting or denying the findings, Raineri consented to the sanction and to the entry of findings that he converted customer funds. The findings stated that, at the request of one of his customers, Raineri began paying some personal expenses for the customer. Over time, Ranieri caused the customer to pay him at least $135,000, ostensibly to reimburse him for the payments he had made. The payments to Raineri, however, far exceeded the customer’s expenses Raineri had paid, and he was not entitled to the extra funds.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $400,000.00 on January 31, 2023.
The customer alleged that the representative converted/misappropriated funds from his bank account, for which he gave the representative power of attorney.
Brokers are required to adhere to the SEC’s Regulation Best Interest (Reg BI) standard of care under the Securities Exchange Act of 1934 which establishes a ‘best interest’ standard for broker-dealers and associated persons. Reg BI applies when brokers recommend a retail investor engage in securities transaction or an investment strategy involving one or more securities. Reg BI also applies to financial advice concerning the transfer of funds and opening of accounts. Reg BI is drawn from fiduciary principles that include an obligation to act in the retail investor’s best interest and the broker is prohibited from placing their own interests ahead of the investor’s interest.
There are several different aspects of the rule that brokers must comply with. One of which is the care obligations which requires brokers to form a reasonable belief that their investment advice and recommendations are in the retail investor’s best interest. The care obligations includes three components. First, the advisor must have an understanding of the potential risks, rewards, and costs associated with a product, investment strategy, account type, or series of transactions. Next, the advisor must have a reasonable understanding of the specific retail investor’s investment profile. The customer’s profile information generally includes an investor’s financial situation and needs; investments; assets and debts; marital status; tax status; age; investment time horizon; liquidity needs; risk tolerance; investment experience; investment objectives and financial goals; and any other information the retail investor may disclose in connection with the recommendation or advice. Finally, the financial advisor must use their knowledge of both their reasonable diligence into investment options as well as their knowledge of the investor’s client specific needs to consider reasonably available investment options. Those investment options must allow the broker to determine that there is a reasonable basis that the recommendation is in the retail investor’s best interest.
In addition to specific investments being recommended, under Reg BI, a broker must also understand the type of account that their client would need in order to meet their care obligations. The SEC has stated that the type of securities account an investor has can greatly affect a customers’ costs and overall investment returns. Further, different account types can offer and support different features, products, securities, or services, and account type would not be appropriately applied in a one size fits all manner.
Raineri has been in the securities industry for more than 16 years. Raineri has been registered as a Broker with Securities America, INC. since 2020.
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.