Securities Lawyers Blog
According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker Richard Stoyeck (Stoyeck), previously associated with Titus Rockefeller, LLC, has at least 2 disclosable events. These events include one customer complaint, one regulatory event, alleging that Stoyeck recommended unsuitable investments in different investment products including debt securities among other allegations and complaints.
FINRA BrokerCheck shows a final customer complaint on August 20, 2021.
Respondent Stoyeck failed to comply with an arbitration award or settlement agreement or to satisfactorily respond to a FINRA request to provide information concerning the status of compliance.
FINRA BrokerCheck shows a pending customer complaint with a damage request of $23,793.00 on February 15, 2020.
Claimant alleges unsuitability, overconcentration, churning, breach of fiduciary duty and fraudulent misrepresentation. He has named Richard Stoyeck as head of the firm for failure to supervise even though Mr. Stoyeck was never the Series 24 Supervising Principal during the period in question. Therefore Mr. Stoyeck cannot be named for failure to supervise. Claimant’s attorney has neglected to point out that his client [REDACTED] is a professional gambler and has been so for decades betting thousands of dollars in individual gambling situations on college and professional football games with accounts set up both in his name and his grandson’s name (they are partners) in Las Vegas, on-line gambling websites, off shore and with professional bookmakers which in the United States constitutes an illegal activity punishable both by fines and imprisonment. What makes Claimant a professional is that he wins regularly with his sports betting activities. Claimant [REDACTED] engaged both his broker and others at the firm regularly in conversation where he regaled us with his exploits as a gambler. We monitored his bets because we found it implausible that an individual could regularly win at betting. [REDACTED] brought the same concentration to his investments in the stock market where he understood the pluses and minuses of all trades that he engaged in. He was in regular contact with his broker, received trade confirmations and month end statements regularly and NEVER COMPLAINED either in writing or verbally to his broker or any other person at the firm during the several years that his account was lodged at the firm. His account was not a fiduciary account and therefore there was no breach of fiduciary duty. All trades were suitable as to his investment objectives. The Claimant signed a trading letter indicating he wanted to trade and was aware of the attendant risks that trading creates. He furthermore understood in writing that such trading can and does lead to higher than ordinary commission generation and he was comfortable with it as well as knew the total associated costs that accompanies a trading account. [REDACTED] had maintained many such accounts in the past with other firms similar in nature and had even sued brokers in the past for the same thing he is alleging now. This leads us to believe that he is simply a man who if he wins takes his chips and runs. If he loses, he uses the arbitration process as an effort to get his money back. Richard Stoyeck looks forward to vigorously defending himself against these allegations.
Financial Advisors providing advice to retail investors are required to adhere to the SEC’s Regulation Best Interest (Reg BI). Reg BI applies a ‘best interest’ standard for broker-dealers and their associated people. This standard applies when brokers make recommendations to retail customer for any securities transaction or investment strategy involving securities, including recommendations of types of accounts. 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.
Another aspect of the care obligation is focusing on the client’s specific needs which brokers must reasonably understand through obtaining information for the client’s investment profile. In completing a customer’s investment profile the advisor should include information such as the investor’s investment time horizon; liquidity needs; risk tolerance; experience with various investment vehicles; investment objectives and financial goals; assets and debts including outside investment accounts; marital status; tax information; age; and other relevant information that may be individual to the investor that the advisor would need to know to properly render advice or provide services. The Reg BI rule applies a fiduciary principles and requires an associated person to act in the retail investor’s “best interests” while barring the broker from placing their own financial interests and compensation incentives ahead of the investor’s best interest. Reg BI comes with different core obligations that brokers must comply with. There is the duty of care obligation requiring financial advisors to form a reasonable belief that their investment advice and recommendations are in the retail investor’s best interest among other duties. In order to do that the broker must evaluate the potential risks, rewards, and costs associated with a product, account type, or series of transactions being recommended.
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. The associated person must then apply both their reasonable diligence into various investment options as well as the information gathered as to the investor’s specific needs when considering the investment recommendation. The broker must explore various alternative investment options available to address these needs and determine that there is a reasonable basis to believe that the recommendation or service being recommended is in the retail investor’s best interest. Brokerage firms and advisors must also understand the features and limitations of various account types as part of meeting Reg BI’s care obligations. Firms typically offer a variety of account options and services with different trading costs, services, such as account and activity monitoring. An advisor’s recommendation as to what type of securities account to open can alter the customers’ overall costs and investment returns. The advisor must determine that the client can benefit from the type of account being recommended to be opened and in the investor’s best interest taking into account the costs, benefits, and needs of the client.
Stoyeck has been in the securities industry for more than 40 years. Stoyeck has been registered as a Broker with Titus Rockefeller, LLC since 1999.
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.