Unauthorized Trading

Larry Boggs Barred by FINRA from Industry for Executing Unauthorized Trades

July 5, 2018 | by Staff Attorney

According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA), in January 2018, advisor Larry Boggs (Boggs) was barred indefinitely from the financial industry by FINRA concerning allegations that he engaged in unsuitable investments, excessive trading and unauthorized transactions. According to FINRA, Boggs exercised discretion in customer accounts without written approval from customers or the firm. Boggs would also allegedly falsely state the investment objectives and risk tolerance of customers in the firm’s books so that customers would conform to his high-frequency trading strategy.

FINRA found that in June 2010, Boggs updated the risk tolerance in 4 investment portfolios from Moderate to Moderate/Aggressive, and changed 2 investment portfolio objectives to Aggressive. FINRA determined that the high-frequency trading strategy was unsuitable to his customer’s needs and did not match the customer’s investment portfolio objectives. By changing Ameriprise’s books and records, Boggs violated FINRA Rules 4511 and 2010.

In addition, in May 2015, Boggs’ employer, Ameriprise Financial Services, Inc. (Ameriprise Financial) discharged Boggs alleging that Boggs violated the company’s discretionary trading and suitability policies.

Michael Resciniti Suspended by FINRA for Executing Unauthorized Transactions

June 25, 2018 | by Staff Attorney

The investment lawyers of Gana Weinstein LLP are investigating the regulatory action brought by the Financial Industry Regulatory Authority (FINRA) against Michael Resciniti (Resciniti). According to BrokerCheck records, Resciniti was suspended by FINRA in December 2017 for seven months. In addition, Resciniti has been subject to five customer disputes and three regulatory orders. Three of the customer disputes are still pending. Many of the claims allege churning and unauthorized trading.

In November 2017, FINRA found that Resciniti executed 31 unauthorized transactions in two of his customer’s accounts. The duration of his suspension is 7 months.

In addition, in February 2016, Resciniti resolved a bankruptcy filing and has a tax lien of over $115,000. Bankruptcies and large tax liens are a potential sign that the advisor has difficulty managing their own finances. FINRA provides this information to the public because it is material for consumers to know whether or not their advisor’s financial situation influences the advisor’s recommendations.

Previously Registered Broker Alexander Kibrik Subject to Two Pending Complaints

March 7, 2018 | by Staff Attorney

The securities lawyers at Gana Weinstein LLP are investigating complaints against broker Alexander Kibrik (Kibrik). According to BrokerCheck records, Kibrik currently has two pending customer complaints.

In March 2017, a customer alleged unauthorized trading and unsuitability. The customer is requesting $413,045 in this pending dispute.

In July 2015, a customer alleged breach of fiduciary duty, negligence, and breach of contract. The customer is requesting $21,125,000 in this pending dispute.

Broker Clifford Vatter Terminated for Unauthorized Trading

January 2, 2018 | by Staff Attorney

According to BrokerCheck records kept by the Financial Industry Regulatory Authority (FINRA), broker Clifford Vatter (Vatter) has received six customer complaints. Furthermore, Vatter was terminated in July 2017 from Raymond James & Associates for allegedly engaging in unauthorized trading in one customer’s account.

In September 2016, a customer alleged Vatter made unsuitable investment recommendations, misrepresented and omitted material facts and breached his fiduciary duty. This dispute settled for $250,000.

In April 2009, a customer alleged Vatter made unauthorized withdrawals among other allegations. This dispute settled for $13,300.

Coleman Devlin Sanctioned By FINRA Over Unauthorized Trading

December 9, 2017 | by Staff Attorney

According to BrokerCheck records financial advisor Coleman Devlin (Devlin), formerly associated with IFS Securities (IFS), has been subject to 14 customer complaints. In addition, Devlin has been subject to two regulatory matters and has been terminated by two firms for cause. In June 2016 Devlin was discharged from Stifel, Nicolaus & Company, Incorporated (Stifel, Nicolaus) on allegations of unauthorized trading. Thereafter, The Financial Industry Regulatory Authority (FINRA) conducted its own investigation of Devlin’s trading activities.

In October 2017, FINRA found that Devlin effected discretionary trades in five customer accounts without obtaining prior written authorization from the customers and without acceptance of the accounts as discretionary by his member firm.

Devlin has also been subject to numerous customer complaints over the course of his career. The most recent case was filed in November 2017 and alleged unsuitable investments. The customer seeks $600,000 in damages and the claim is currently pending.

Former Morgan Stanley Broker Peter Doyle Barred by FINRA

December 3, 2017 | by Staff Attorney

The investment lawyers of Gana Weinstein LLP are investigating the regulatory action brought by the Financial Industry Regulatory Authority (FINRA) against former Morgan Stanley broker Peter Doyle (Doyle).

According to BrokerCheck records, Doyle was terminated from Morgan Stanley in June 2016 for failing to adhere to industry rules and/or firm policies including with regard to the use of trading discretion. Doyle’s failure to appear for FINRA requested on-the-record testimony in connection with its investigation into the conduct that led to his termination led to his bar from the industry. Without admitting or denying the findings, Doyle consented to the sanction and to the entry of findings that he refused to appear.

Before Doyle’s termination, Morgan Stanley was ordered by a FINRA arbitration panel to pay over $8 million in damages in a customer dispute concerning allegations that Doyle made unauthorized trades, failed to disclose fees, and engaged in the financial abuse of an elderly customer.

Advisor Frederick Houck Sanctioned Over Unauthorized Trading

November 10, 2017 | by Staff Attorney

According to BrokerCheck records financial advisor Frederick Houck (Houck), formerly associated with Freedom Investors Corp. (Freedom Investors), has been subject to one customer complaint, six tax liens or judgments, and one FINRA sanction. According to records kept by The Financial Industry Regulatory Authority (FINRA) Houck has been accused by a customer of churning, negligence, excessive trading, and breach of fiduciary duty from August 2011 to January 2016 causing $150,000 in damages. The claim is currently pending.

In August 2017 FINRA sanctioned Houck alleging that Houck exercised discretion in executing 491 transactions in the accounts of two customers as part of a recommended investment strategy without obtaining prior written authorization to exercise discretion and without his member firm having approved these accounts for discretionary trading.

Advisors are not allowed to engage in unauthorized trading. Such trading occurs when a broker sells securities without the prior authority from the investor. All brokers are under an obligation to first discuss trades with the investor before executing them under NYSE Rule 408(a) and FINRA Rules 2510(b). These rules explicitly prohibit brokers from making discretionary trades in a customers’ non-discretionary accounts. The SEC has also found that unauthorized trading to be fraudulent nature because no disclosure could be more important to an investor than to be made aware that a trade will take place. Often times, brokers engage in unauthorized trading as part of an attempt to churn or excessively trade a client’s account.

Advisor Jonathan Iraggi Terminated Over Unauthorized Trading

October 26, 2017 | by Staff Attorney

According to BrokerCheck records financial advisor Jonathan Iraggi (Iraggi), currently associated with National Securities Corporation (National Securities), has been subject to two customer complaints and one employment separation for cause. According to records kept by The Financial Industry Regulatory Authority (FINRA) Iraggi has been accused by customers of unauthorized trading among other claims.

In July 2017, Iraggi was permitted to resign from Garden State Securities, Inc. (Garden State) after allegations were made that the broker engaged in unauthorized trading. Also in July 2017 a customer filed a complaint against Iraggi stating damages of $22,000 caused by unauthorized trades. The claim was denied by the firm. In 2015 another customer filed a complaint also claiming unauthorized trading.

Advisors are not allowed to engage in unauthorized trading. Such trading occurs when a broker sells securities without the prior authority from the investor. All brokers are under an obligation to first discuss trades with the investor before executing them under NYSE Rule 408(a) and FINRA Rules 2510(b). These rules explicitly prohibit brokers from making discretionary trades in a customers’ non-discretionary accounts. The SEC has also found that unauthorized trading to be fraudulent nature because no disclosure could be more important to an investor than to be made aware that a trade will take place.

Raymond James Terminates Broker James Lyons Over Unauthorized Trades

October 6, 2017 | by Staff Attorney

According to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA) financial advisor James Lyons (Lyons), has been subject to five customer complaints and one employment terminations for cause. Lyons was formerly associated with Raymond James & Associates, Inc. (Raymond James) until April 2017 when the firm terminated his employment due to customer allegation of unauthorized trading.

The most recent customer complaint filed against Lyons alleged that from December 2013 through June 2017 the broker engaged in unauthorized and unsuitable trading resulting in $800,000 in damages. The complaint was filed in June 2017 and is currently pending. Previously a customer in April 2016 alleged unauthorized trading resulting in $1.2 million in damages. That claim was eventually settled for $400,000.

Advisors are not allowed to engage in unauthorized trading. Such trading occurs when a broker sells securities without the prior authority from the investor. All brokers are under an obligation to first discuss trades with the investor before executing them under NYSE Rule 408(a) and FINRA Rules 2510(b). These rules explicitly prohibit brokers from making discretionary trades in a customers’ non-discretionary accounts. The SEC has also found that unauthorized trading to be fraudulent nature because no disclosure could be more important to an investor than to be made aware that a trade will take place.

Financial Advisor John Nelson Crook Receives Alleged Unauthorized Trading Complaints

July 17, 2017 | by Staff Attorney

Our firm is investigating customer disclosure claims concerning broker John Nelson Crook (Crook). Crook’s FINRA BrokerCheck record shows several disclosures of allegations concerning churning (excessive trading, unauthorized trading, unsuitability, and breach of fiduciary duty. His BrokerCheck records also show a disclosure concerning an employment separation after allegations.

In July 2015, Crook was discharged from Raymond James & Associates Inc due to the findings that that the financial advisor allegedly did not respond in a timely manner to a supervisory review of trading activity. In addition, Crook allegedly did not provide a legitimate explanation for the trading activity in a certain client’s account, which lead to his termination from the firm in July 2015.

The most recent customer complaint against Crook was received in November 2015.During the period between August 2006 and June 2015, Crook allegedly engaged in excessive and unauthorized trading. Crook allegedly also recommended unsuitable investment products to his client, fraudulently misrepresented, and breached his fiduciary duty. The alleged damages are worth over $4 Million and the case is currently pending.