Securities Lawyers Blog
According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) broker Bryan Moskowitz (Moskowitz), previously associated with Nylife Securities LLC, has been subject to at least one disclosable event. These events include one tax lien. Several of those complaints against Moskowitz 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 November 11, 2024.
Without admitting or denying the findings, Moskowitz consented to the sanctions and to the entry of findings that he excessively and unsuitably traded a customer account. The findings stated that Moskowitz recommended high frequency in-and-out trading to the customer, a veterinarian in his mid-60s, even when the price of his recommended securities did not materially change. The customer relied on Moskowitz’ advice and routinely followed his recommendations, and as a result, Moskowitz exercised de facto control over the account. Moskowitz’ recommendations resulted in an annualized turnover rate of 18 and an annualized cost-to-equity ratio of approximately 93 percent. Moskowitz’ in-and-out trading in the customer’s account generated total trading costs of $16,902, including $13,145 in commissions, and caused $81,614 in total realized losses.
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 or a few months, the account could be completely replaced with new securities. This type of investment trading activity in the client’s account serves no reasonable purpose for the investor and is engaged in only to profit the broker through the generation of commissions created by the trades. Churning is considered a species of securities 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.
Moskowitz has been in the securities industry for more than 12 years. Moskowitz has been registered as a Broker with Nylife Securities LLC since 2023.
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.